Episode summary
How jobs data will impact mortgage rates
HousingWire Daily
· · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Mortgage rates are being driven less by labor-market weakness than by inflation, conflict risk, and the bond market’s read on growth. Logan Mohtashami says the 10-year yield around 4.46% is roughly where it should be if the market believes the conflict is easing, and that mortgage rates would need a clearer drop in oil and diesel prices to move materially lower.
On jobs Friday, he argues the headline number matters less than the trend in jobless claims, wage growth, and breadth across sectors. Logan says anything above 33,000 jobs is still acceptable for the Fed, while his own break-even is closer to 78,000 because population growth is slowing and the workforce is aging. He expects the Fed to remain cautious unless labor softens noticeably or inflation cools further.
He also says the old “labor over inflation” framing is less useful for mortgage rates right now because labor data is better than it was last year and inflation pressure has re-accelerated. Looking ahead, he warns that debates over the Federal Reserve’s dual mandate and changes tied to Kevin Warsh could reshape policy later in the year.
Key takeaways
- Logan Mohtashami says mortgage rates are roughly fair at a 4.46% 10-year yield if the conflict risk is fading.
- He считает anything above 33,000 jobs is acceptable for the Fed, but his break-even is about 78,000 jobs a month.
- Mohtashami says wage growth at 3% or below would help the Fed become more comfortable.
- He argues that jobless claims, not one monthly payroll print, are still the key indicator for whether the labor market is breaking.
- He says mortgage rates could only get meaningfully lower if the conflict ends and oil and diesel prices fall further.
Notable quotes
“anything above 33,000 to me is keeps the story the same”
“my break-evens is 78,000 jobs per month”
“the Federal Reserve wants wage growth at 3% and under”
“jobless claims is the key to everything”
How the episode opens
Welcome everyone. My guest today is lead analyst Logan Moshami to talk about jobs Friday and what it can mean for mortgage rates. First, let's recap the top five trending stories over on housingwire.com.
The top trending story is the housing markets that missed the pandemic boom are quietly outperforming. Followed by Sam Valverde on why Pulte's DNI role won't sideline GSE reform. Then we have small investors, not Wall Street, are tightening the path to homeownership.
And New York AG probes Compass Anywhere acquisition. Wrapping it up, we have who can buy a top 20 builder now? Berkshire resets board calculus.
You can read all of that with a HousingWire subscription and you can get 20% off of that with the code podcast 20. We have another exciting day, so Logan, welcome back to the podcast.
It is wonderful to be here. You are in Miami, right? Right now still?
In Miami. I do leave today and exciting news. So I went to the award program last night, the National Association of Real Estate Editors um awarded the Real Trending podcast um a silver award, huge deal.
This is such a big organization. All the big guys are here, New York Times, Bloomberg, Wall Street Journal, every uh real estate uh thing you can think of and um so really proud of Tracy, our producers that help um on that podcast. So yeah, exciting.
Excellent. Excellent. I'm I'm in lovely Irvine, California, which — You know, I always consider Irvine Babylon. It's the greatest city in America ever, so I'm always biased. — That's a very funny reference. Okay, well, we have a lot to talk about. Jobs, jobs, jobs. Tell us.
Yeah, so of course it's Thursday morning. Um more headline news. Last night the 10-year yield fell a few basis points, oil fell a few a few um uh a few dollars lower because Israel's is going to make peace with, you know, Lebanon and Hezbollah has already shoot that back.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- jobs data
- mortgage rates
- labor market
- inflation expectations
- housing market
Watch the episode
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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