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Mortgage rates stay near 7% as US jobs data clouds Fed outlook
30-year conforming rates averaged 6.91%, and the July payroll drop of 23,000 positions, plus downward revisions, is tempering expectations for near-term rate hikes.
Mortgage rates remained close to 7% on Tuesday, with 30-year conforming loans averaging 6.91% and 30-year jumbo loans averaging 6.92%, according to HousingWire Data. FHA-backed 30-year loans were up to 6.65%, HousingWire said. The outlet noted that weekly movement in mortgage rates has been minimal as markets digest weaker labor data.
HousingWire pointed to July nonfarm payrolls falling by 23,000, along with downward revisions totaling 103,000 for May and June, as factors weighing on expectations for how quickly the Federal Reserve could move. Traders were split on whether a September hike is likely, while HousingWire said Fed officials indicated rates could remain steady unless inflation stays elevated.
The story also highlighted that a cooling labor market may affect both consumer behavior and the Fed’s policy path. HousingWire quoted Cotality chief economist Selma Hepp, saying the payroll pullback signals a more pronounced slowdown and could dampen consumer confidence, potentially making households more cautious about major financial decisions like home purchases.
HousingWire also cited Mortgage Bankers Association vice president and deputy chief economist Joel Kan, who pointed to wage growth of 3.2% outpacing the latest inflation reading, and said the July unemployment rate decline to 4.1% was driven by a drop in labor force participation rather than increased hiring. HousingWire reported that slower job growth could give the Fed some breathing room, though it expects inflationary pressures to persist through the remainder of 2026.