Mortgage Rates Update

Rates have once again followed the slow rise that has become a familiar trend. As expected the Federal Reserve raised the Fed Funds Rate by 25 basis points to 4.5% when they met on Tuesday bringing the Prime Rate up to 7.5%. With the Fed Meeting behind us, we look towards the Labor Department's report scheduled for release tomorrow. This report is by far the most important of the week. The Labor Department will post January’s Employment data, giving us the U.S. unemployment rate and the number of jobs added or lost during the month among other related statistics. Analysts are expecting to see the unemployment rate remain at 4.9% and approximately 250,000 new jobs. An increase in unemployment and fewer new jobs than expected would be great news for the bond market. It would probably create a bond market rally, leading to lower mortgage rates tomorrow.