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Economic Update for the Week Ending September 4th, 2021

U.S. employers added 235,000 jobs in August – The Department of Labor and Statics reported that 235,000 new jobs were added in August. That number shocked analysts as economists surveyed by Dow Jones had predicted 720,000 new jobs.  Experts point to a pullback in hiring due to a surge in new COVID cases. For example,  the leisure and hospitality sector had been gaining 350,000 jobs a month for the last six months, but that stalled in August. There were also 400,000 workers that said could not work for pandemic-related reasons.  Average hourly wages rose 4.3% year over year. The unemployment rate was 5.2% in August, down from 5.4% in July. It has fallen from a high of 14.8% at the start of the pandemic, but is a long way off from its 3.5% rate before the pandemic.

Business Man Holding Happy Labor Day Sign

Stock Markets – Stock indexes remained mostly stable this week. Despite a disappointing jobs report that shocked experts, a hurricane that caused massive damage and flooding throughout the eastern U.S., and no letup in sight on the latest wave of COVID-19 cases, investors remained unfazed.  The Dow Jones Industrial Average closed the week at 35,369.01, down 0.2% from 35,455.80 last week. It is up 15.6% year-to-date.  The S&P 500 closed the week at 4,534.43, up 0.6% from 4,509.37 last week. It is up 20.6% year-to-date. The NASDAQ closed the week at 15,363.52, up 1.6% from 15,129.50 last week. It is up 19% year-to-date.

U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 1.33%, almost unchanged from 1.31% last week. The 30-year treasury bond yield ended the week at 1.94%, up slightly  from 1.91% last week. We watch bond yields because mortgage rates often follow treasury bond yields. 

Mortgage rates – The September 2, 2021, Freddie Mac Primary Mortgage Survey reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate was 2.87%, unchanged from 2.87% last week. The 15-year fixed was 2.18%, unchanged from 2.17% last week. The 5-year ARM was 2.43%, unchanged from 2.42% last week.

Sources:

  1.  Rodeo Realty, Inc.
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