Last Week's Economic Retrospective.
Last week the Department of Labor reported that there were 180,000 jobs added during March and another 32,000 jobs added to February's reports.  The Unemployment report showed the Unemployment Rate dropped to 4.4% matching the lowest rate in six years.  The Average Hourly Earnings report showed earnings were up too, rising to $17.22 per hour.  This was good news for the US job market, but bad news for home loan rates, since a strong labor market can lead to inflation and inflation adversely affects Bonds and home loan rates.  Bond prices slipped lower, causing home loan rates to rise slightly across the board.

So, for two weeks in arrow, we have had reports which suggest higher inflation: 1st the Personal Consumption Expenditure Index; and 2nd, last weeks new job formations / Unemployment report plus the Hourly Earnings report.  Don't expect the Feds to cut the Federal Fund rate any time soon.

This Week's Economic Forecast.
The Federal Reserve Board's "Meeting Minutes" from their March 21st meeting will be released this week. This is important because reports the actual Fed Meeting Minutes and all the commentary and discussion between Fed members, unabridged.  This is drastically different than the carefully worded press release that is published after the meeting.  Not all members vote at each meeting, but all have a voice. Was the decision to keep the Fed Funds Rate in a paused position unanimous?  What did Fed President Jeffrey Lacker, a non-voting member, do?  Did he continue to voice his preference for a rate hike?

The market may start this week with a little volatility as last Friday's trading session was condensed into just a few hours of trading before a market close in observance of Good Friday.  Stocks should improve off the strong Jobs Report, which could hurt bonds and home loan rates.  Bond pricing and home loan rates will likely get a bit worse before they get better.

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Best Regards
AJ Nisen
Thank you for your interest in starting a mortgage a conversation with me.  Remember, Bank of America has Industry leading low rates and is a full service bank. Bring me any mortgage offer to compete with to see what we can do for you.  I look forward to serving you in the future!

Alan "AJ" Nisen, MBA, Notary
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