09/08/2025
Week in review (9/5/25)
Hello, this is Derek Baker with your weekly market update.
Last week’s inflation report came in right on target, shifting this week’s focus to the job market – and the data shows signs of a slowdown.
The latest report from the Bureau of Labor Statistics showed the U.S. added just 22,000 jobs in August. This followed ADP’s report that private employers added just 54,000 jobs, with both figures well below expectations. Continuing unemployment claims have stayed above 1.9 million for 15 straight weeks, meaning more people are out of work for longer. Job openings also dropped to a 10-month low.
So, why does this matter?
This weaker labor data has helped the Mortgage Bond market improve, which in turn is helping mortgage rates trend lower – welcome news for homebuyers and homeowners. It also matters because the Federal Reserve closely monitors both inflation and employment when making interest rate decisions.
When inflation is high, the Fed typically raises rates to cool spending. But when the economy starts to weaken, rate cuts are often used to stimulate growth.
Fed Chair Jerome Powell recently noted that a rate cut is getting closer, depending on how the data unfolds. Based on what we’ve seen so far, a cut seems to be a lock at the Fed’s next meeting on September 17.
Just a quick reminder: when the Fed adjusts rates, they’re changing the Fed Funds Rate, a short-term rate banks use to lend to each other. It doesn’t directly set mortgage rates, but it does influence them, along with other borrowing costs.
Thinking about buying, refinancing, or just want to better understand what this means for you? Let’s connect. I’m here to help.
