Mortgage rates saved from hike

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

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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.