Stronger than expected economic data caused Mortgage Backed Securities (MBS) to decline today ahead of tomorrow's important employment report. As a result, mortgage rates repriced higher again this afternoon pushing the 30-year rate offered by most lenders to 4.875%.
The yield on the 10-year Treasury approached 3.00%, the highest level since July 2011.
Today's labor market data, ADP Employment and Jobless Claims came in higher than expected.
The Employment Report will be released tomorrow at 8:30am ET. The consensus is for an increase of 175,000 jobs and for the Unemployment Rate to remain at 7.40%. With this report's influence on the Federal Reserve's policy, this data will most likely be a major player in the market tomorrow. As is typically the case, good news is generally bad news for mortgage rates.