Mortgage Rate Update: Weak Jobs Report Pushes Mortgage Rates Lower

What Did Rates Do This Week?

Mortgage rates moved lower this week, with nearly every major loan program improving by about 0.125%. The biggest driver was Friday’s weaker-than-expected jobs report, which showed the U.S. economy lost 23,000 jobs in July.

A softer labor market reduces inflation concerns and increases the likelihood that the Federal Reserve could lower interest rates in the coming months. While the Fed doesn’t directly set mortgage rates, expectations for future rate cuts helped push mortgage rates lower this week.

What to Look Forward to Next Week

Next week, investors will continue watching economic data for signs of whether the labor market is slowing further. Markets will also keep a close eye on inflation reports, as both employment and inflation remain key factors influencing mortgage rates.

Lock or Float Bias

Current Lock/Float Bias: Neutral to Slight Lock

The recent improvement in mortgage rates gives borrowers with flexible closing timelines an opportunity to float in hopes of additional gains. However, markets can change quickly, so borrowers closing soon should continue monitoring rate movement closely.