Mortgage investors nudged rate sheet prices lower this morning after government data showed job losses in March were not as dismal as many had anticipated.
Employers cut 663,000 jobs in March, a little steeper drop than the consensus estimate for a loss of 650,000. The actual job loss was far less severe than the 700,000 "whisper" number that was floating through the marketplace late yesterday afternoon.
Shortly after the March nonfarm payroll data hit the wires the Institute of Supply Management announced their service sector index posted a reading of 40.8% last month. This data leaves little doubt the downturn in demand and fallout from the global credit crunch is continuing to take a severe toll on the economy.
Looking ahead to the coming holiday shortened week the direction of mortgage interest rates will likely be most influenced by the two scheduled Treasury auctions. Uncle Sam will be in the credit market on Wednesday and Thursday looking to borrow more than $50 billion in the form of 3- and 10-year notes. This new incoming supply will likely serve to put a temporary floor under mortgage interest rates.
Next week's economic calendar offers nothing of consequence and traders will likely begin slipping away from their desks early on Thursday to get a jump on the first three-day weekend of the spring. The mortgage market will be closed all day on Friday in observance of the Good Friday Holiday.
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