A stronger-than-expected jobs report for September caused mortgage rates to rise from 6.26% to 6.53%. According to housing market platform Redfin, rates will likely stay elevated until there are clearer signs of economic weakness. If the economy continues to perform better than expected, rates could increase even more.
In the context of all recent labor market data, including job openings, quits, and unemployment insurance claims, the labor market has weakened meaningfully, but it is clearly on solid footing. Today’s report pushes the three-month moving average of the job creation rate to 186,000 jobs per month, less than half of what it was two years ago and 13% lower than it was a year ago. The three-month moving average of the unemployment rate remains at 4.2% meaning the Sahm Rule is still triggered as it is half a percentage point higher than it was in January.
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