Mortgage Rate Update November 7, 2016

Mortgage rates are unchanged from last week.

Election day is only 24 hours away.  The stock market is rallying this morning following the FBI’s announcement over the weekend that they would not pursue charges against Hillary Clinton based on a new batch of emails.

Purely looking at the election from the stock market’s perspective the ideal outcome is for Clinton to win the presidential election while the House of Representatives and Senate remain in Republican control.  Since this outcome is optimal for the stock market we can deduct that it is also probably the worst case scenario for mortgage rates (when stocks do well mortgage rates tend to suffer).

In case you missed it Friday’s all-important jobs report showed the US economy created ~161,000 new jobs in October.  In addition, the Labor Department revised the two previously released numbers for August & September higher.  The jobs market remains solid which generally is bad news for mortgage rates.

What was interesting about the jobs report was that average hourly earnings increased by 2.8% from a year earlier.  This represents the largest increase since 2009 and ignites concerns regarding wage-based inflation.

All in all I am not excited about the momentum in the market.  I am going to maintain a locking bias.

Current Outlook: locking bias