Last Friday I did not send a newsletter out because I was in Paso Robles in 110 F heat. And it looks like I wasn’t the only one drying up on my trip.
This week had one data point to move the markets and that was the Institute of Supply Management’s service sector Index for August. This number crept up from 53.9% to 55.3%: indicating a stronger economy.
Unfortunately, this was not good for mortgage rates because it is only one indicator of a possibly stronger economy.
The non-farm payrolls were UP 154,000 and the jobless rate was also UP to 4.4% – also the June and July payroll numbers were revised LOWER by 41,000. All these should have helped mortgage interest rates but it was a short trading day and like me, many bond traders were already “checked out of office” – so no movement to lower rates occurred.
The next big week for rates and for the year will be the end of September. If the economy looks weak (and it usually does because of seasonality), we will get lower rates with disappointing numbers.
But hang in there. What goes up must come down. We’ll get through this slow cycle soon!