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Clouded Jobs Report: The Weekly Market Update

Clouded Jobs Report: The Weekly Market Update
McLean Mortgage

Hurricane Damage

Hurricane Damage

The jobs report is a very significant economic indicator. Yet, it seems that every monthly jobs report takes on some extra form of significance. This one is certainly no exception, with the report coming in the midst of the recovery from two natural disasters hitting major population centers within the United States. Hurricanes Irma and Harvey caused major damage to some of the largest states in America — Florida and Texas — as well as affecting several other population areas.

Along with major damage, lives were changed radically. It is anticipated that we will certainly see the effects of these disasters in our economic numbers, and the jobs report should be the first major indicator. It was no surprise that initial claims for unemployment were up in the weeks after the hurricanes hit and that these additional claims were concentrated in the affected areas. The numbers may not be affected radically on a national level, but there are likely to be major changes regionally and these will affect the national numbers. How much? We will know by Friday.

The good news is that these numbers should be temporary, as many jobs will be created in the rebuilding of affected areas. So, the markets will be prepared for one or two down months, but should be anticipating a rebound pretty quickly. The Federal Reserve Board meets two more times this year and most are expecting one more rate increase in December. The size and extent of the damage and rebound may very well be one of the determining factors in this decision.

The Weekly Market Update

Rates were flat in the past week, but rates were rising at the end of the survey period. This would make rates susceptible to an increase in the next survey week, unless there is a reversal of trends. For the week ending September 28, Freddie Mac announced that 30-year fixed rates remained at 3.83%. The average for 15-year loans was at 3.13%, also the same as the previous week. The average for five-year adjustables moved up to 3.20%. A year ago, 30-year fixed rates averaged 3.42%.

Attributed to Sean Becketti, chief economist, Freddie Mac — “Rates held relatively flat this week. The 10-year Treasury yield fell just 1 basis point, while 30-year fixed rates remained unchanged at 3.83 percent.”

Note: Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.