Mortgage Rates - Recommend "Lock" Before Jobs Report

The Labor Department will report the February jobs numbers tomorrow morning, which includes Non-farm Payrolls (expected 163K) and the Unemployment Rate (expected 6.6%). The data comes after two consecutive weak reports for December and January.  Many are blaming the weather as a cause for the recent bad numbers we have seen, even though some of those numbers expectations. 

The bond and mortgage markets opened weak this morning following a flat day yesterday, with Mortgage Backed Securities (MBS) taking another day of weakness and the 10yr pushing 2.75%.  Weekly jobless claims were expected to be down 10K, as reported claims were down 26K to 323K - the lowest in 3 months.  US stock indexes rallied on the decline.  In a separate report Q4 productivity revision declined to +1.8% against forecasts of +2.6% and the advance report last month that indicated an increase of 3.2%.  Q4 unit labor costs were expected to decline 0.5%, as reported down 0.1%, in the advance report last month labor costs were reported -1.6%.  Lower productivity leads to an increase in unit labor costs.  No real direct reaction to the revisions as all focus today will be n tomorrows BLS Feb employment report.

There are always questions that come up before any Jobs Report, and today will be no different, especially what we have seen in the last two months.  If one floated the last two months, even though the numbers were not close to expectations, the risk/reward was not there.  The ol’ cliché that I have always stated “Pigs get fat and Hogs get slaughtered” certainly can come into play here.

Could we have a third poor Jobs Report in a row?  My estimation along with a number of other folks is stating the fact that it will.  But – what will the market’s reaction to this be?  My viewpoint is that if we see a negative number, the weather will certainly be the blame, and if we see a good number, the markets will react negatively towards mortgage rates.  My advice - lock ahead of the Jobs Report. 

Remember, if you want to know the benefits of locking your rate today versus floating, simply give me a call at 314-744-7806 or visit me on my website at www.CallTheMoneyMan.com   I have access to real time Wall St. data and instant market alerts with breaking news that I monitor throughout the day to assist us on making the informed decision.