Economic update for the week ending April 8, 2017

Job gains stall in March – The Labor Department reported that 98,000 new jobs were added in March. Experts had expected a gain of 185,000. The unemployment rate dropped to 4.5%, its lowest reading since 2007, and down from 4.7% in February, where 235,000 jobs were added. The labor participation rate, which shows the share of working-age people in the workplace, was unchanged at 63%. Wages in March grew 2.7% from one year ago. That was below last month’s year over year 2.8% increase. This was also a number that had been increasing at a better pace, which was disappointing. Experts were taken by surprise after ADP, the nations largest payroll company, estimated that 263,000 jobs would be added just two days before the official number was released. Experts opinions were mixed. Some blamed the weather for the drop in hiring. Some pointed to the surprisingly strong job growth in January and February and shrugged off the drop looking more at the monthly average over the past 3 months, which is still a strong number. A few experts warned that this may be the first sign that job creation is stalling as employers are becoming less optimistic of the surge they had expected in the economy following the election. One thing most experts agree on is that the Fed will not hike interest rates at their next meeting because of this jobs report.

Stocks lower this week – Stocks were down slightly again this week. They are down about 3% from their all time highs just 3 weeks ago. It should be noted that they are still up over 10% since November. First quarter earnings will begin to come in over the next few weeks. The Dow Jones Industrial Average on March 31, 2017 was 20,656.10, down from last week’s close of 20,663.22. The S&P 500 closed the month at 2,355.54, down from 2,362.72 last Friday. The NASDAQ closed the month at 5,877.81, down from last week’s close of 5,911.74.

Treasury Bond slightly lower again this week – The 10-year Treasury bond ended the week at 2.38%, down from 2.40% last week. The 30-year treasury yield ended the month at 3.00%, down slightly from 3.02% last Friday. 

Mortgage Rates – The April 6, 2017 Freddie Mac Primary Mortgage Survey reported that the 30 year fixed mortgage rate average was 4.10%, down from 4.14% last week. The 15 year fixed was 3.36%, down slightly from 3.39% last week. The 5-year ARM was 3.19%, slightly higher than 3.18% last week. 

Have a great weekend,