How Weak Jobs Report Could Offer Unexpected Mortgage Boost For Thousands
Summary
A weaker-than-expected jobs report showed that U.S. employers cut 23,000 jobs in July, signaling a softer labor market. This may lead the Federal Reserve to pause or slow down interest rate increases, which could help keep mortgage rates from rising further and provide some relief to homebuyers.Key Facts
- U.S. employers reduced 23,000 jobs in July, and previous months’ hiring numbers were lowered.
- Job losses were mostly in local government, education, and retail trade.
- The labor market appears weaker than many experts expected.
- The Federal Reserve kept interest rates steady in late July at 3.5% to 3.75%.
- The Fed may avoid raising rates soon due to the weaker job report and focus on its goal to reduce inflation to 2%.
- Mortgage rates usually rise when the Fed raises its key interest rate, but a pause could stop mortgage rates from going higher.
- Lower or unchanged mortgage rates are generally better news for people buying homes.
- The Federal Reserve’s next interest rate decision is scheduled for September.
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