Mortgage markets were relatively calm throughout last week’s holiday-shortened trading sessions.
After trading within a tight range between Monday and Wednesday, a weak jobs report helped edge rates lower into the weekend.
For the second week in a row, mortgage rates ended the week lower than where they started — if only slightly.
Meanwhile, if it’s the expectation of runaway economic growth that fueled the early-June, mortgage rate run-up past 6 percent, it’s the tempering of those expectations that helped rates retreat by a 1/2 percent or more since.
While the housing sector continues to post strong numbers, employment is showing that it may not rebound as quickly as previously thought and U.S. consumer confidence remains shaken.
The Unemployment Rate rose to its highest levels in 25 years last month and key confidence levels fell.
With negative job growth and falling consumer optimism, it only makes sense that mortgage rates would fall — fewer people are working and the public feels uneasy about spending its money.
This week — without much new data due — market momentum could push rates even lower. In general, perceived weakness in the economy will be good for mortgage rates and strength will be bad.
However, there’s a wildcard.
This week, some of the world’s largest nations are expected to call on a replacement for the U.S. dollar as a global currency reserve. Depending on how serious the discussion grows, the value of the U.S. dollar could be negatively impacted and that would spell bad news for rate shoppers.
A weakening U.S. dollar is linked to higher mortgage rates.
Mortgage rates remain favorable and unpredictable. If today’s rates make sense for your household budget, consider locking in. Rates won’t likely end the week at the same levels at which they started.
