U.S. mortgage rates fell after a weaker-than-expected jobs report drove investors to the safety of the government bonds that guide borrowing costs.
The average 30-year fixed mortgage rate was 10 basis points lower than last week and the lowest since November, according to a statement Thursday from Freddie Mac. The average 15-year rate dropped 11 basis points, the McLean, Va.-based mortgage-finance agency said.
The U.S. in December gained the fewest jobs in two years, Labor Department figures showed last week, bolstering speculation that an uneven economic recovery may slow the pace of the Federal Reserve’s cuts to its bond-purchase program. Yields on the benchmark 10-year Treasury notes fell the most since September after the report.
U.S. employers added 74,000 jobs last month, compared with the median forecast for 197,000 positions in a Bloomberg News survey. About 2.2 million jobs were added last year, the most since 2005.
Fed policymakers plan to gradually reduce the pace of bond buying as the economy strengthens. The committee in December decided to cut purchases to $75 billion, from $85 billion, citing improvements in the labor market.
The stimulus has kept borrowing costs at historic lows, adding support to a housing rebound that’s also been driven by a tight inventory of homes for sale. Home prices in November rose almost 12% from a year earlier, data from Irvine, Calif.-based CoreLogic showed.