(NerdWallet) – Mortgage rates fell to their lowest levels since March because job growth has been surprisingly weak this summer.

The 30-year fixed-rate mortgage averaged 6.7% in the week ending Aug. 7, down from 6.87% the previous week. It’s the lowest average rate since the week ending March 13, when it was 6.62%.

A lousy jobs report

Rates began falling last Friday morning, right after the release of July’s employment report. The economy grew by 73,000 jobs, according to the Bureau of Labor Statistics. That was less than most economists were forecasting. Worse, the initial estimates for job growth in May and June were revised downward by a total of 258,000.

Investors were as surprised and disappointed as a kid who thought she was going to get a Barbie for her birthday, only to receive a box of pencils instead.

“Friday’s disappointing jobs report drove the sharp fall in mortgage rates, as investors now anticipate slower growth and an earlier Fed rate‐cut cycle,” said Kara Ng, senior economist for Zillow, in an email.

Help from the Fed is dead ahead

Investors now believe the Federal Reserve will almost certainly cut short-term interest rates at its next meeting ending Sept. 17, according to the CME FedWatch tool. Before Friday’s jobs announcement, investors thought there was less than a 50% chance of a rate cut.

The Fed is given the job of fighting both unemployment and inflation. It generally tries to reduce short-term interest rates when jobs become scarce, and raise rates when prices rise too fast. Until the jobs report came out, the Fed seemed to be more worried about inflation than unemployment. Now investors think unemployment is the villain, and that the central bank will battle it with at least one rate reduction.

The mortgage market is acting like the Fed will be ready to take action next month, explained Odeta Kushi, deputy chief economist for First American, a provider of title insurance and real estate settlement services.

“Since mortgage rates tend to move ahead of Fed actions, they’ve been falling in anticipation,” Kushi said in an email. “If confidence builds around a September rate cut, we could see rates continue to trend downward in the near term.”

How much will this help, really?

But what if mortgage rates stop falling? Then this week’s rate decrease is a nothingburger, Ng believes. “This dip likely won’t be enough to salvage the sluggish home buying season,” she said. “Lower rates may tempt a few prospective home buyers off of the fence, but a dip of this size isn’t likely to make a notable difference.”

However, interest rates could drop significantly if the economy falls into a recession — that’s what Mike Chadwick, president of Fiscal Wisdom Wealth Management, believes will happen. “I think we’re also going to see a situation where mortgage prices come down and property values come down, which is not something you see every day,” he says.

Lower mortgage rates and lower home prices might sound like a wonderful combination for people who aspire to buy their first home. But it would take a deep recession for those two events to come together, meaning a lot of folks would be unemployed or scared of losing their jobs. That’s not a recipe for a lively housing market.