Mortgage rates saved from hike

Despite healthy May job growth, federal funds rate expected to rise 'gradually'

Another very healthy employment report this morning should have taken mortgage rates above 6.5 percent, but we have been rescued by a new charm offensive from the Fed.

May payrolls gained 248,000 jobs, close to forecast, but the immensely strong, 652,000-job gain in March and April together was revised upward by an additional 75,000 workers. Employment is increasing in all sectors, in hours worked, in overtime, and in earnings.