rewrite this title Weekly Mortgage Rates Marginally Higher as Markets Await Job Data – NerdWallet

Mortgage interest rates basically treaded water this week, waiting for a big market mover to make a splash. Spoiler alert: Expect that to happen tomorrow.

But first, this week: The average rate on a 30-year fixed-rate mortgage rose three basis points to 6.62% the week ending Sept. 4, according to rates provided to NerdWallet by Zillow. A basis point is one one-hundredth of a percentage point.

Friday brings the Bureau of Labor Statistics’ Employment Situation, better known as the jobs report. The jobs report is often significant for mortgage rates, since half of the Federal Reserve’s dual mandate is a goal of ‘maximum employment.’ (That doesn’t mean everyone has a job; it just means the job market is functioning well.) But the August numbers coming Friday are especially anticipated because of what happened last month.

July’s jobs report, which came out at the beginning of August, caught markets by surprise. The slow pace of hiring in July — 73,000 jobs added — was lower than expected, but not abysmally so.

On the other hand, the downward revisions to May and June’s numbers definitely qualified as abysmal. The number of jobs added in May and June was just 19,000 and 14,000, respectively. That put those months a total of 258,000 jobs lower than their initial estimates.

Six-digit adjustments to jobs numbers aren’t unheard of; July’s numbers came with a 90% confidence level on a confidence interval of plus or minus 136,000. That’s a lot of confidence and a lot of numbers. But basically, it means the Bureau of Labor Statistics is 90% sure that July’s 73,000 job count is correct, give or take 136,000 jobs.

Still, the downward revisions shook even those well-versed in employment data, and we quickly saw stocks tumble while the odds of a Federal Reserve rate cut shot upward.

Wednesday’s JOLTS report (that’s the Job Openings and Labor Turnover Survey) was in line with expectations. It wasn’t great, but that also meant it wasn’t disastrous. And anyway, Friday’s jobs report is truly this week’s main attraction.

Polls of economists suggest that the number of jobs added will be around 75,000 to 80,000. That’s better than July, but not outrageously so. There’s also potential for revisions to previous months to steal the show from the August data, as happened with last month’s report.

Given the July report’s revisions, an especially positive jobs report probably won’t rock the markets, though it could make the Federal Reserve a bit more hesitant about cutting rates at its September meeting.

As of today, it’s considered a near certainty that the Federal Reserve will lower the federal funds rate by 25 basis points at its meeting later this month. The thing is, mortgage rates have already made that move — even if rates are slightly higher this week, overall average rates have fallen 25 basis points since the end of July. The week ending July 31, just after the Fed’s last meeting, 30-year fixed mortgage rates were averaging 6.87%.

But what if the Fed took a bigger swing? Last year, we were in a similar situation: Following a July meeting that held rates steady, job numbers took a turn for the worse, and the central bankers surprised with a 50-basis-point September rate cut. No one is predicting that large of a cut right now, but if the August jobs report is significantly worse than expected, a bigger cut would not be out of the question.