Economic update for the week ending April 2, 2022

The U.S. economy added 431,000 new jobs in March – The Department of Labor and Statistics reported that 431,000 new jobs were added in March. Economists surveyed had expected 490,000 new jobs. The unemployment rate fell to 3.6% in March, down from 3.8% in February. The labor-force participation rate (the share of workers with a job or actively looking for a job) rose to 62.4% in March, up from 62.3% in February. It is still below the 63.6% level before the pandemic but has moved up steadily as more people are returning to the workforce. Average hourly wages, an indicator of inflation increased 5.6% from March 2021.

Stock markets closed higher on Friday to erase losses earlier in the week – Stock markets began the second quarter higher after the worst-performing quarter in two years. The week ended on a positive note with unemployment dropping to historic lows, oil falling below $100 a barrel, treasury bond yields lower, and early indications of strong corporate profits – The Dow Jones Industrial Average closed the week at 34,818.25, down 0.13% from 34,861.24, last week. It is down 4.1% year-to-date. The S&P 500 closed the week at 4,545.86, almost unchanged from 4,543.06 last week. The S&P is down 4.7% year-to-date. The NASDAQ closed the week at 14,261.50, up 0.65% from 14,169.30 last week. It is down 8.8, year-to-date.

U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 2.38%, down from 2.48% last week. The 30-year treasury bond yield ended the week at 2.44%, down from 2.60% last week. We watch bond yields because mortgage rates often follow treasury bond yields.

Mortgage rates – Home mortgage rates continued to increase this week. The March 31, 2022, Freddie Mac Primary Mortgage Survey reported that mortgage rates for the most popular loan products were as follows: The 30-year fixed mortgage rate was 4.67%, up from 4.42% last week. The 15-year fixed was 3.83% up from 3.63% last week. The 5-year ARM was 3.50%, up from 3.36% last week.