The Labor Department announced earlier this morning that employers added 114,000 workers to their payrolls last month – matching almost exactly the number most economists had been projecting. Labor Department officials also announced they had undercounted employment gains in July and August by a combined 86,000. Most economists had been anticipating the national jobless rate, a value derived by a separate telephone survey of American households, would tick higher to 8.2% from the August mark of 8.1% — but government data wonks said those expectations were much too pessimistic.

According to Labor Department statisticians the biggest single monthly increase in household employment since 1983 sent the national jobless rate tumbling to 7.8%. According to the government’s household survey numbers — 873,000 Americans said they either had a job or found a job last month – with roughly 582,000 of these people saying they were working part-time even though they wanted full-time work. The 873,000 employment gain in September followed an 119,000 decline in the household survey number in August. The Labor Department said the household employment survey data can be volatile on a month-over-month basis. Labor Secretary Hilda Solis was quick to assure the press and market participants any notion the jobless rate was manipulated for political purpose was absolutely “ludicrous.”

The coming holiday shortened week will feature a three-day, $66 billion Treasury debt auction of 3-and 10-year notes and a 30-year bond component. The macro-economic calendar will be thinly populated with Thursday’s weekly jobless claims number and Friday’s September Producer Price Index representing the only top-tier reports investors will consider.

Once again trading activity in the stock markets will likely exert the largest influence on the trend trajectory of mortgage interest rates over next week’s four trading sessions. Higher stock prices will tend to put some modest – but nonetheless noticeable – upward pressure on rates while lower stock prices will probably prove supportive of steady to perhaps fractionally lower mortgage interest rates.

Mortgage Rates as of October 5, 2012 ( purchase transactions )

30 day rate locks, subject to credit score and loan to value edits

FHA

30 year fixed 3.00% 0% origination fee 2.875% with 1.0% origination fee

Conventional

30 year fixed rate 3.25% (*LTV and credit score could impact this quote) ( .50 origination fee, 760+ score)

3.375% 0% origination fee

15 year fixed rate 2.75%

5/1 ARM 2.375%

7/1 ARM 2.75%

 

To speak with a mortgage officer, contact Bob Strandell.