Mortgage Rates Decrease Slightly, Big Downward Revision In Non-Farms Payroll
Mortgage rates decreased 3 basis points from last week, according to the Freddie Mac Primary Mortgage Market Survey released August 22nd. Although mortgage rates have stayed relatively flat over the past couple of weeks, softer incoming economic data suggest rates will gently slope downward through the end of the year. Earlier this month, rates plunged and are now lingering just under 6.5 percent, which has not been enough to motivate potential homebuyers. Rates likely will need to decline another percentage point to generate buyer demand.
Mortgage applications decreased 10.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending August 16, 2024. “Both mortgage rates and mortgage applications have now stabilized after a few weeks of financial market volatility, which led to a quick drop in mortgage rates.” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. He added, “Home sales have slowed despite rising inventory levels. Even with lower mortgage rates, potential buyers might be more selective now that there are more options.”
The U.S. economy created 818,000 fewer jobs than originally reported in the 12-month period through March 2024, the Labor Department reported Wednesday. As part of its preliminary annual benchmark revisions to the nonfarm payroll numbers, the Bureau of Labor Statistics said the actual job growth was nearly 30% less than the initially reported 2.9 million from April 2023 through March of this year. The revision to the total payrolls level of -0.5% is the largest since 2009. The numbers are routinely revised each month, but the BLS does a broader revision each year when it gets the results of the Quarterly Census of Employment and Wages.
Consumer sentiment rebounded in August for the first time in five months. The latest University of Michigan consumer sentiment survey released Friday showed that sentiment ticked higher in August. The index reading for the month came in at 67.8, up from 66.4 in July and above the 66.9 economists had expected. It was the highest reading of consumer sentiment since June. The reading on consumer sentiment comes amid a volatile two weeks for the stock market and the overall narrative surrounding the US economy. A weaker-than-expected July jobs report fueled concerns about how rapidly the US labor market is cooling, helping spark a market sell-off.
