Why February 1st Just Might Be The Most Important Date for Mortgage Rates
Written By: David Reed
Thursday, January 31, 2019
Markets both react to and anticipate economic reports. It seems there is always some economic data >
The Unemployment Report for the previous month is >
The unemployment rate actually increased in December but thatrsquo;s not because the economy is slowing down, and people are losing their jobs. Quite the opposite. The economy is rather healthy right now and that means more people will start to look for work once again having decided to get out of the workplace altogether. Unemployment numbers only look at those who are out of work and actively looking and doesnrsquo;t count those who decide to leave the employment scene enti>
People are jumping back into the workforce due to higher wages, as well. According to recent data, wages grew by 3.2 percent in 2018 and while at first glance that doesnrsquo;t seem like very much, it most certainly is. Thatrsquo;s the largest increase in wages in 10 years. Further, there were 312,000 new jobs created in December which was much more than most anticipated. But, again, will January show some sort of correction to those numbershellip;or confirm them?
Thatrsquo;s why February 1st is one of the more anticipated dates for investors in quite some time. If the economy shows another round of stout jobs numbers, itrsquo;s very likely we could see the Fed start to get back in the game. Fed Chair Powell has gone a bit back and forth over the past few months regarding when and if the Fed will raise the Federal Funds rate once again. Last fall, Powell suggested we could see two more rate increases in 2019 but later suggested that wasnrsquo;t necessarily written in stone and that the Fed would keep a close eye on the economy to see where it may be headed.
With another month of strong jobs numbers to join Decemberrsquo;s count, itrsquo;s very likely wersquo;ll see rates in general begin to rise, and mortgage rates will certainly follow suit if investors decide itrsquo;s time to pull money from bonds and more into stocks. For those who are waiting for rates to fall a little more, they might be waiting for a while.
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