This is the question I keep getting asked! And as I told someone earlier today, that is the million dollar question and no one really knows! Here are some of the thoughts based on reports from this week. The big report will come tomorrow when we see the December BLS jobs report. If the numbers show employment is weakening, it could help interest rates.
Mortgage rates were fairly steady this week with the 10 year Treasury holding around 4.15% which helped mortgage rates from seeing any major improvement.
The JOLTS (job openings and labor turnover survey) showed signs of a softer labor market. November job openings came in at 7.146 million which was below expectation of 7.648 million. This means companies were posting fewer open roles. October job openings also were revised lower from 7.670 million to 7.449 million. This report tracks how many open jobs employers are trying to fill.
The ISM services index, which measures activity in service-based industries like healthcare, retail and restaurants came in at 54.4. Since readings above 50 signal growth, this shows the economy is still expanding. Within that report, the ISM services prices paid fell from 70.0 to 64.4, suggesting that businesses are seeing less pressure from rising costs. That is a positive sign that inflation may be easing.
Housing policy also made headlines as President Trump proposed limiting large investors from purchasing single family homes to improve affordability. It’s just a proposal but anything affecting housing supply is worth watching.
Rates haven’t made any major moves yet, but cooling labor data and easing inflation pressures are exactly what the Fed wants to see when setting policy. As more data comes in, the markets could react quickly. Friday’s jobs report will be important along with the inflation reports due next week.
With all that said, no one expects rates to move much in the next month or two, but we’ll see! They are better than they were a year ago, so that is good news. If you are wondering how this could affect your home buying search, please reach out!
Leslie Vanderwerf, NMLS ID#335509, CrossCountry Mortgage LLC, An Equal Housing Lender, NMLS#3029 – Email – Website
