T
he US added 321k jobs last month (forecast was 240k), the largest gain since November 2011. Mortgage-backed securities and Treasuries slammed: Expect mortgage rates to jump today from recent lows. Unemployment rate remained the same at 5.8%. September was revised up from 256k to 271k.
- NFP 321k vs 230k forecast
- Biggest increase since January 2012
- October revised to 243k from 214k; September revised to 271k from 256k
- Unemployment rate 5.8 vs 5.8 forecast
- Average hourly earnings +0.4 vs +0.2 forecast
One thing to remember, though: If you are worried about how this will affect the housing market, jobs drive housing, NOT mortgage rates! Jobs, Jobs, Jobs! So this is good news for the economy as a whole.
Below is the 3-month chart on the 3.5 Fannie MBS. Note that higher prices denote lower rates; we are still trending much lower than 3 months ago.
3 month