Headline news made investors (and politicians) jumpy this week, and the average American received a mixed bag of money matters.
Job growth, as reported by the Department of Labor, came in at 98,000 in March, following gains of 216,000 in January and 219,000 in February. Both January and February job numbers were revised downward by a total of 38,000 from initial reports, and the March number was nearly half of what was expected. On a positive note, the Unemployment Rate dropped from 4.7 percent to 4.5 percent from February to March, the lowest in 10 years. Plus, average hourly earnings rose 2.7 percent over the last year, though wage growth slipped from February to March. 
In housing news, CoreLogic, a leading provider of data analytics, reported that home prices, including distressed sales, jumped 7 percent from February 2016 to February 2017 due in part to high demand and limited supply across most local markets. Month over month, prices rose 1 percent. Looking ahead, prices are expected to rise 4.7 percent from February 2017 to February 2018.
Jobs data spurred some market volatility, but markets were further agitated by continued unrest in North Korea and Syria as well as March Federal Open Market Committee meeting minutes that revealed the Fed may begin to shrink its balance sheet by the end of 2017 and that some members are worried Stock evaluations are too high.
Mortgage Bonds benefited throughout the week because investors are uncomfortable with uncertainty. Home loan rates are tied to Mortgage Bonds, so when Bond prices improve, home loan rates can improve too. At this time, home loan rates remain near historic lows.
If you or someone you know has any questions, please don't hesitate to contact me.
Forecast for the Week
Inflation numbers are the ones to watch this week as the Fed continues to weigh its 2017 monetary policy options. The Bond markets close at 2 p.m. ET on Thursday and both Stock and Bond markets are closed Friday in observance of Good Friday.
Inflation numbers will be reported in Thursday's wholesale Producer Price Index and Friday's Consumer Price Index.
Also being released on Thursday will be weekly Initial Jobless Claims and the Consumer Sentiment Index.
Retail Sales are scheduled for Friday.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.
When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.
To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.
As you can see in the chart below, Mortgage Bonds improved to levels seen in January, keeping home loan rates near historic lows.
Chart: Fannie Mae 3.5% Mortgage Bond (Friday, April 7, 2017)
