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Mortgage rates set to swing before Sept. 16 Fed meeting
Markets are looking to the August jobs report on Friday and the August JOLTS report due Wednesday, with futures pricing a roughly two-thirds chance of a hike.
Mortgage rates could move sharply in the two weeks leading up to the Federal Reserve’s Sept. 16 meeting as expectations for a potential hike have returned, following Chair Warsh’s Jackson Hole speech, according to Redfin News.
The data calendar is likely to drive the day-to-day rate swings, with the August jobs report expected on Friday and the August JOLTS report on job openings, layoffs, and quits expected on Wednesday. After July’s 23,000-job decline, August is forecast to rebound to about 55,000 jobs created, while the unemployment rate is expected to stay low at 4.1%.
JOLTS job openings are highlighted as the most important part of the labor-market release and are expected to edge down slightly from July, based on real-time Indeed data. Redfin News notes that while labor data will be closely scrutinized, the Fed is still more focused on inflation when deciding whether to change rates.
The Sept. 16 meeting also falls right after the Fed’s blackout period begins, with speeches from governors scheduled during the run-up. Redfin News said Warsh’s remarks carried a hawkish message on inflation and suggested policy is not restrictive enough even when considering areas like housing, shifting the market “default” toward needing good data to avoid a hike rather than bad data to trigger one.