The first week of the year was a short one with little economic news but good economic news. On Wednesday the ISM had a stronger number than expected: 59.7& up from 58.2% for November. This is great sign of a stronger economy, and therefore bad news for fixed rates.

Friday we received the December non-farm payroll numbers – payrolls were up 148,000, the jobless rate remained the same at 4.1%, and average hourly earnings were up 0.3% – good news for people, bad news for the mortgage rates…

The big news of the week, of course, was that the Dow Jones industrial average (DJIA) hit 25,000. It was also announced that 2,000,000 jobs were created in 2017. Lots of good news (which usually means higher interest rates). We are bound to have a correction, but with the new tax laws putting more money in the average person’s pocket and corporations having more money on their bottom line, it could go higher.

Once the euphoria dies down, or maybe we don’t see immediate cash in the economy from these tax savings, we may see a correction and then a “flight to quality” which is the bond market. More money flooding in means lower rates. so when you hear people say, rates will never come down again, don’t be so sure… Of course if you or someone you know still has a rate above 5% call me to refinance; don’t wait.