Mortgage ratesspiked, big-time, today. Underlying bond markets had already moved higher in rate overnight, but the trend was taken to a new level by an exceptionally strong employment report from ADP. Although this isn’t the big jobs report (we’ll get that on Friday), many market participants treat the ADP numbers as one of several advance indicators of Friday’s jobs report. Sometimes it doesn’t register a response, but when it beats the forecast by as much as it did today (298k vs 190k), markets can’t help but adjust their trajectory ahead of Friday.
The net effect was the sharpest move higher in rates in several months, slightly outpacing last Wednesday’s rout. Moreover, with the exception of a modest improvement on Monday, rates have moved higher every single day since February 27th. In just over a week, the average conventional 30yr fixed quote is up approximately a quarter of a percent for most lenders. Stronger lenders are offering 4.25% on top tier scenarios while many moved up to 4.375% with today’s weakness.
We think there is growing pressure to lift international capital market rates higher, which will create upward momentum on rates in Australia.
Trump’s first full month in office brings massive employment boom as U.S. companies added whopping 298,000 new jobs in February
New job figures from ADP beat economists’ estimates by more than 100,000
Read more: http://www.dailymail.co.uk/news/article-4293622/Trump-s-month-brings-massive-employment-boom.html#ixzz4anAYfURp