All eyes were on the February jobs report which came in better than expected this morning: 242,00 new jobs were created versus 190,000 expected. Unemployment remained under 4.90%. This overall positive employment report included a revision of 30,000 more jobs created in December and January put pressure on bond yields. With both the stock market and oil trading well again this week, mortgage interest rates responded by moving higher.
The positive jobs report coupled with a significant comeback in global equities has left the door cracked open for an additional Fed rate hike later this month. It is anyone’s guess what will happen, but the odds are increasing that a rate hike this year may be put back on the table.
Technically speaking, bonds have traded poorly, and we remain biased toward locking in loans with the 10-year U.S. Treasury note still trading well below 2.00%.