The monthly jobs report from the Bureau of Labor Statistics (BLS) is largely seen as the biggest potential mover of mortgage rates.
It gives us a quick check on how the economy is faring, and more importantly the consumer. Wages, job creation, unemployment, and the like.
So the September jobs report that will be released tomorrow was already very important.
It became even more important thanks to the government shutdown, which stopped the flow of all economic data for a month.
And somehow it just got even more important because the BLS announced it’s not even going to release an October jobs report.
In addition, November’s jobs report will now come out after the December Fed meeting.
This Jobs Report Carries Even More Weight Than Normal for Mortgage Rates
Tomorrow morning we’ll finally find out if the labor picture brightened, or continued on its recent dark path.
The past few jobs reports were really ugly, both falling short of expectations and even going negative thanks to revisions for the month of June.
That led to some of the lowest mortgage rates in nearly three years, a big win for existing homeowners looking to refinance to a lower rate.
And a positive for prospective home buyers who may have previously been priced out of the market.
However, it also paints a not-so-great picture of the economy, which many believe is beginning to show some serious cracks.
That makes home buying a little less inviting if you fear for your job security, or believe home prices are going to experience a major correction.
So we’ll call it a silver lining at best. But that’s kind of the catch-22 of mortgage rates.
They tend to move lower when the economy is slowing, and higher when the economy is expanding.
September Jobs Report Has a Very Low Bar
That’s brings us to tomorrow’s jobs report, which was supposed to be released all the way back on October 3rd!
As noted, there’s been a lot of anticipation about it since we’ve had a dearth of new data thanks to the longest government shutdown in U.S. history.
So all eyes were already on the report’s release and the stakes are higher than ever.
The current forecast is for 50,000 new jobs created during the month of September, per the median forecast compiled by Marketwatch.
That’s a pretty low bar, despite the jobs numbers coming in so low in prior months, including a 22,000 print in August.
But it pales in comparison to earlier months that had estimates in the six figures, which wound up falling short.
In other words, a beat tomorrow is technically easier to achieve since the forecast is so low.
Mortgage Rates Could Jump or Plummet Tomorrow
If job creation happens to come in above that 50,000 forecast, bond yields could jump higher and that would be bad for mortgage rates.
It would signal that the economy is still chugging along and that the Fed wouldn’t necessarily need to cut again in December.
Strengthening that argument is the fact that Nvidia released earnings today and they exceeded expectations.
All of a sudden, the economy might not look so bad. Stocks could rally, bond yields and mortgage rates could jump.
On the other hand, if the jobs report somehow manages to come in below expectations, which is entirely possible (if not probable) given how bad it’s been lately, bond yields could plummet.
In the process, mortgage rates would likely have a very good day and could continue back on their merry way toward the 5s.
Long story short, tomorrow is an especially important day for mortgage rates because of the delayed report coupled with the fact that we won’t get an October report.
And the November report will come AFTER the last Fed meeting of 2025.
Buckle up folks.
Read on: Mortgage rates tend to be lowest in winter.
Before creating this site, I worked as an account executive for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to begin writing about mortgages 19 years ago to help prospective (and existing) home buyers better navigate the home loan process. Follow me on X for hot takes.