Last month's reduction in the key interest rate is still failing to have a noticeable impact on the mortgage market. The U.S. Mortgage Bankers Association said its market index dropped 2.7% during the week to 636.7. Purchase activity was off 1.8%, while refinancing dropped 3.8%. Compared to a year ago, however, the total number of applications (for both new purchases and refinancing) edged up 0.4%, thanks to a large jump in government loans.
And from the labor market, Challenger Gray & Christmas reported a total of 71,739 job cuts during September, a 28.5% drop from September 2006. So far in 2007, there have been 587,594 layoffs announced, 8.1% lower than the first 9 months of 2006. About 37% of last month's layoffs came from the housing sector, which dismissed 26,465 of its employees. Job cuts from the mortgage industry accounted for about 82% of all job losses from the financial sector, or roughly 52,000 of 70,000 in the industry.
Finally, an indicator published by payrolls company Automatic Data Processing (ADP) indicated that the private jobs sector should add 58,000 positions in September, down from economists' earlier prediction of 100,000. All of this conjecture occurs ahead of the September nonfarm payrolls report, due at 8:30 a.m. on Friday.