The first Friday of any month, as we note regularly, produces an economic report that everyone watches: the monthly jobs report from the Bureau of Labor Statistics. 

The report comes out early in the morning and generates much discussion at offices, factories, schools and employment offices, on television and in newsrooms

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It will happen again starting at 8:30 a.m. ET on Friday. That is, if the report actually comes out. 

Related: Watch out: Soaring stocks could tip markets over

The problem is much of the government may shut down at 11:59 p.m. Tuesday because of Democratic refusal to fund government operations without some big changes in the recently passed Trump tax-and-spending legislation. 

The reason: The bill will cut back spending on Medicaid services, and thousands of American may not get essential care in the next few years. 

But if a meeting between Republicans, Democrats and President Trump on Monday results in keeping the government open, the jobs report is expected to show: 

• Unemployment rate at 4.3%, unchanged from August. 
• Nonfarm payroll growth of 26,750, up a little from the August report. 

A 4.3% unemployment rate is solid and comes even as companies reduce plans to expand their work forces or institute layoffs in an environment where growth in some sectors is slowing. 

The data will also be questioned because it is really just the first draft of what the jobs environment looks lie in September. The data will be updated repeatedly over the next year.

The employment picture is supposed to darken in the next months in part because of the effect tariff increases have on the economy. But many companies who had boosted worker rolls during the pandemic are shedding staff they don’t believe they need

Scores of employers have warned employees about potential job cuts ahead. Microsoft  (MSFT)  has already cut more than 9,000 jobs this year alone. Ford Motor  (F)  has announced 1,000 job cuts. Procter & Gamble Co.  (PG)  plans to cut 7,000 white-collar jobs over the next two years.  

Jobs picture will affect interest and mortgage rates

A weak jobs report, however, will ensure the Federal Reserve surely will cut their key interest rate at their Oct. 28-29 meeting and again in December.  The rate is now 4% to 4.25% after a quarter-point cut at the Fed’s September meeting. 

And a weak jobs report will give bond investors confidence inflation pressures are easing. That could help push yields lower. Lower bond yields, particularly of the 10-year Treasury note, will translate into lower mortgage rates.

Freddie Mac’s weekly mortgage survey put the rate on a 30-year mortgage at about 6.35%, up slightly from a week earlier but down from roughly 7% in January.

On a $250,000 mortgage, that reduces the monthly (before taxes and insurance) from $1,663 a month in January to $1,547, a savings of nearly $166 a month or nearly $2,000 a year.

Mortgage rates hit a low of under 2.8% in August 2021 at the end of the Covid-19 pandemic. But inflation took off thereafter, pushing the 30-year rate to 7.8%. That meant the monthly payment on a 30-year loan reached as high as $1,800.

Home sales and construction stalled until recently. 

The Mortgage Bankers Association’s weekly application survey suggests that lower rates have generated new interest in buying homes or refinancing existing mortgages. 

More Economic Analysis:

• Google makes a harsh decision amid alarming worker dispute
• Fed official drops bold 3-word message
• JP Morgan sends strong recession message on Fed interest-rate cut
• Fed rate cut could boost your wallet, job, and portfolio

More housing data scheduled

Two reports also due this week will offer hints of the impact of rate changes:

• The National Association of Realtors’ Pending Home Sales report for August, due Monday morning. It should show a modest increase in activity.
• The S&P Cotality Case-Shiller Home Price Index, due Tuesday. It should show prices moderating. They seem to be falling in places like Tampa, Fla. 

Also due this week:

• Consumer Confidence report from the Conference Board, due Tuesday.
• ADP Employment Index, due Wednesday. A widely-watched measure of private sector employment.
• Two reports on manufacturing activity in September, due Wednesday. Issued by the Institute for Supply Management and Standard & Poor’s.
• Factory orders for August, due Thursday from the Commerce Department.
• Reports on Services Sector activity for September, again from the ISM and Standard & Poor’s.

Related: Major airline cancels flights to 10 US cities, 20M impacted