Mortgage Rate Update March 3, 2016

Mortgage rates are unchanged for the week.  That may all change tomorrow with the release of the all-important jobs report.

If you remember back to last month the jobs report missed expectations coming in at only 158,000 new jobs created.  This month analysts expect the report to show 190,000 new jobs created.  If the actual figure comes in higher than expected mortgage rates are likely to worsen and vice versa.

It’s always difficult to predict the monthly jobs report but based on what I am seeing I think there is more risk in floating than there is in locking.  Why?

First, from a technical perspective momentum is working against us.  See the chart below.

Second, recent domestic economic data has been relatively healthy.  Private Payroll company APD released its version of the monthly jobs report yesterday and it showed that 214,000 new jobs were created last month.  In a separate release, the Fed released a report which showed that consumer spending rose in much of the nation during the first part of the year.

Lastly, given that last month’s report was released well below expectations I believe that there is a greater likelihood that it will be subject to a revision higher which would put upward pressure on mortgage rates.

Current Outlook: locking