Portland Mortgage Market Update — April 4, 2025

Tariffs and Jobs and Recession- oh my! Liberation day was Wednesday where President Trump announced sweeping tariffs across all US trading partners. The result was… not ideal. In after hours trading pretty much every future metric tanked as investors fled to safety of gold and treasury bonds. The Dow has since lost more than 10% of its value, and the S&P and Nasdaq reported their worst day yesterday since the onset of Covid. Today China issued retaliatory tariffs further fanning the flames of a trade war. BOTTOM LINE-THIS VOLATILITY IS GOOD FOR MORTGAGE RATES AND WE SHOULD BE SCREAMING THIS FROM THE ROOFTOPS TO ALL OUR CLIENTS!

Oh, and there was an employment report today. The jobs report would usually be the focus of the week, but today's snuck in behind all this tariff talk. In today's report it showed 228K jobs were created in March, but previous months were revised downward by about 48K which tempered this. And while the unemployment portion increased to 4.2% from 4.1%, but if you take those numbers ot the hundredths decimal point that increase is actually a 4.15% increase vs last month's 4.14%. The rounding makes it look worse than it actually is. Net/net, today's report was pretty soft which was probably a welcome relief to traders trying to navigate the crumbling stock market.

JP Morgan stokes recession fears. In a note they released yesterday, JP Morgan said "Disruptive U.S. policies have been recognized as the biggest risk to the global outlook all year" and bumped up its odds of a recession from 40% to 60%. They also said this tariff shock could be "modestly dampened" by the prospect of further rate cuts. Last week the market consensus was on 2 rate cuts this year, but as of this morning the market is saying there is an almost 70% chance we see between 4 or 5 rate cuts. Again-rates are already improving and are in a great position to do so further. Let your fence-sitters know this and call your clients from the past 2 years that they may need to refi.