This month’s employment report added 120,000 jobs, with 140,000 private jobs offsetting government losses. There were also upward revisions to September and October adding 72,000 more jobs than previously reported. Bottom line, this Jobs Report shows that the labor market continues to improve at a gradual pace. Couple this with other recent positive economic signals and we can see that we are not near a recession at the moment.
But our economic health remains fragile, and any external shock from Europe could easily disrupt the economic improvement we are seeing. European issues are likely to be with us for a long time.
For now, the Fed’s continued purchase of mortgage backed securities balances out the good economic news, puts downward pressure on rates and keeps them essentially where they have been since November 1st. While I don’t see rates moving much higher in the near-term, I also don’t see rates move much lower. Inflation numbers are elevated and if they continue to creep higher, this will limit any improvement home loan rates may see.
This week Freddie Mac’s 30 yr. fixed rate survey remained at that 4% assuming points and good credit.
Senior Loan Officer
Senior Loan Consultant
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