Healthy Job Gains Continue

Healthy Job Gains Continue

Overall, the economic data came in pretty close to expectations this week, and Greece successfully reached a debt deal with private bondholders. With a lack of surprises in the economic news, mortgage rates ended the week with little change.

While it was stronger than expected, the important monthly Employment report had only a minor impact on mortgage rates. Against a consensus forecast of 200K, the economy added 227K jobs in February, and revisions to prior months added an additional 61K jobs. The Unemployment Rate remained at 8.3%, as expected. Average Hourly Earnings, a proxy for wage growth, increased at a 1.9% annual rate. With gains above 200K for the first three months of the year, the recent pickup in job growth and the decline in Jobless Claims reflect solid improvement in the labor market.
Greece took a necessary step along its path to receive a much needed financial aid package. Private bondholders agreed to the proposed Greek bond swap deal, which will help reduce its debt burden. Without the deal, Greece was at risk of a potentially disastrous full default on its debt. This may have forced Greece to leave the European Union, possibly disrupting financial markets around the world.