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Today’s Mortgage Rates in April 2026
April 13, 2026
1️⃣ Oil Prices Surge Past $100 as Geopolitical Risk Escalates
Oil markets moved sharply higher this week, with prices breaking above $100 per barrel following reports that the United States is preparing to blockade Iranian ports after failed peace negotiations. This marks a significant shift in geopolitical risk and immediately raised concerns about global energy supply disruptions.
Higher oil prices feed directly into inflation, impacting everything from transportation costs to consumer goods. Markets reacted quickly, with bond yields showing volatility as investors attempt to price in the inflationary impact.
Historically, energy shocks of this magnitude create short term upward pressure on interest rates, which has limited any meaningful improvement in mortgage pricing despite broader economic concerns.
2️⃣ Consumer Sentiment Falls to Record Lows as Inflation Fears Build
Consumer confidence dropped to its lowest level on record, reflecting growing concern about rising prices and economic uncertainty tied to the ongoing conflict. Inflation expectations surged, with many households now anticipating significantly higher costs over the next year. This shift in sentiment matters because it can become self-fulfilling, as consumers adjust spending behavior and businesses respond by raising prices.
While a weakening consumer outlook typically signals slowing economic growth, the Federal Reserve faces a difficult position as inflation expectations remain elevated. For mortgage markets, this creates a push and pull dynamic where recessionary signals would normally help rates improve, but persistent inflation fears are keeping upward pressure on borrowing costs.
3️⃣ March Inflation Data Shows Sticky Core Pressures
The latest inflation report for March showed that while headline numbers remain somewhat contained, core inflation continues to prove stubborn. Shelter, services, and energy related categories all contributed to ongoing price pressure, reinforcing the idea that inflation is not cooling as quickly as markets had hoped.
On a year over year basis, inflation remains above the Federal Reserve’s target, and monthly readings suggest that progress has slowed. When combined with rising energy costs, there is increasing concern that inflation could reaccelerate in the months ahead.
At the same time, GDP growth has slowed to just 0.5%, signaling an economy that is losing momentum. This combination of slowing growth and persistent inflation is not ideal, but over time it may help cap how high mortgage rates can move if economic weakness becomes more pronounced.
💡Rates & Market Outlook
Bottom Line:
In the longer run, higher oil prices will add increased pressure to household budgets, likely leading to slower economic growth. With GDP already expanding at just 0.5%, we are approaching levels typically associated with recession risk. This should help soften mortgage rates over time. However, in the near term, market volatility remains elevated and inflation risks are rising. We maintain a locking bias.
April 06, 2026
1️⃣ Oil Shock Drives Inflation Fears
Global energy markets delivered one of the most aggressive moves we have seen in years, with Brent crude for physical cargo surging to roughly $141 per barrel, a level not seen since 2008.
This spike is being driven by escalating tensions surrounding Iran and the growing threat to supply routes through the Strait of Hormuz, where a significant portion of the world’s oil flows each day. As energy prices move higher, the impact is immediate and widespread, hitting everything from gasoline to transportation and manufacturing costs.
Markets are quickly repricing inflation expectations higher, which has put upward pressure on Treasury yields and mortgage rates. Historically, moves of this magnitude in oil tend to bleed into broader consumer prices over the following months, reinforcing the concern that inflation may reaccelerate just as the Federal Reserve was hoping to gain control.
2️⃣ Labor Market Remains Resilient, Complicating Fed Outlook
The March jobs report showed that the labor market continues to hold firm despite mounting economic headwinds. Job creation came in stronger than expected, with 178,000 new jobs reported. Given other data points from ADP, layoff reports, and alternative payroll tracking sources, this figure is being met with some skepticism, with many economic pundits questioning its accuracy. The bond market appears to share that skepticism, as mortgage rate pricing remained relatively stable following the release.
However, unemployment remains near historically low levels and wage growth is still elevated. While a strong labor market is generally a positive sign for the economy, it creates a challenge for inflation management. Continued wage pressure supports consumer spending, which keeps demand elevated at a time when supply constraints, particularly in energy, are intensifying. For the bond market, this combination is not ideal. Strong employment data reduces the likelihood of near term rate cuts and reinforces the Federal Reserve’s need to remain cautious. As a result, mortgage rates have struggled to find relief, as investors adjust to the reality that policy may need to stay tighter for longer than previously anticipated.
3️⃣ Inflation Pressures Reignite Amid Geopolitical Tensions
Early readings on inflation since the onset of the Iran conflict are pointing toward a renewed spike in price pressures. Energy is leading the way, but the concern extends well beyond oil, as higher input costs begin working their way through the broader economy. Initial estimates suggest that this week’s upcoming inflation reports could show a noticeable jump, reversing some of the progress made in recent months.
This shift comes at a critical time, as markets had been pricing in a gradual cooling of inflation throughout 2026. Instead, the combination of geopolitical instability and a still resilient consumer base is creating a scenario where inflation may remain sticky or even move higher in the near term. For mortgage markets, this is a clear negative, as higher inflation expectations typically translate into higher long term interest rates.
💡Rates & Market Outlook
Bottom Line:
With President Donald Trump setting Tuesday as the final day for Iran to open the Strait of Hormuz or face “hell,” this is shaping up to be a highly volatile week for mortgage rates. While a resolution could bring some relief and potentially lower rates in the near term, the risk of further escalation and higher rates remains elevated. We will maintain a locking bias.
March 30, 2026
1️⃣ Rate Volatility Driven by Geopolitics and Oil Prices
In what has become one of the most volatile stretches for mortgage rates since the pandemic era, markets closed the week with national averages climbing above 6.64% (based on Mortgage News Daily). Just weeks ago, we were seeing rates in the high 5% range before tensions escalated in late February. This past week was defined by sharp market swings, largely reacting in real time to statements from Donald Trump regarding the ongoing conflict with Iran.
Outside of lucky traders who happened to place lucrative bets on markets minutes ahead of market moving announcements, many Americans lost by paying higher gas prices and mortgage rates. While there is growing pressure globally to restore stability and reopen key energy supply routes like the Strait of Hormuz, markets remain on edge. The relationship remains clear. As oil prices move, mortgage rates are following closely behind.
2️⃣ Wealthy Consumers Signal Broader Economic Concern
A notable shift is emerging among higher income households, a group that typically shows resilience during economic uncertainty. Recent data shows that even affluent Americans are beginning to pull back as gas prices surge and stock market volatility increases.
Declines in portfolio values combined with rising everyday costs are starting to impact confidence at the top end of the market. This matters because higher income consumers drive a disproportionate share of discretionary spending and housing demand. When confidence weakens in this segment, it often signals broader economic slowing ahead. Consumer sentiment indicators are beginning to reflect this change, raising concerns that the economy may be entering a more fragile phase just as inflation pressures remain elevated.
3️⃣ Mortgage Rates Climb as Housing Market Faces New Pressure
The housing market is now directly feeling the effects of rising geopolitical tension and higher borrowing costs. Mortgage rates have increased for the fourth consecutive week, pushing affordability further out of reach for many buyers during what is typically the start of the spring buying season. This sudden rise has already led to slower application activity and increased hesitation among prospective buyers.
At the same time, inventory levels are gradually improving, but not enough to offset the affordability challenges created by higher rates. Sellers remain cautious, and many buyers are recalculating budgets in real time. Unless rates stabilize, we can expect continued pressure on transaction volume despite underlying demand for housing remaining relatively strong.
💡Rates & Market Outlook
Bottom Line:
Mortgage rates continue to show great volatility based on the news of the day. While mortgage pricing is better today that it was on Friday, there is no telling what tomorrow will bring. If you need to close in the near-term, locking remains prudent.
March 23, 2026
1️⃣ Fed Holds Rates as War Creates Uncertainty
The Federal Reserve held its benchmark rate steady at its latest meeting, signaling a cautious approach as geopolitical risks continue to rise. Officials pointed directly to the conflict in Iran as a key source of uncertainty, particularly with its potential to drive energy prices higher and disrupt global markets.
While inflation has shown some signs of cooling in recent months, the Fed made it clear that progress is fragile. Their tone suggests they are far from confident enough to begin cutting rates, and in fact, are prepared to stay restrictive longer if inflation pressures reaccelerate.
In fact, odds now favor a rate hike over a rate cut, which was not in the cards prior to the conflict in Iran. For mortgage markets, this reinforces the reality that relief is not imminent and rate volatility will likely remain elevated.
2️⃣ Producer Prices Signal Ongoing Inflation Pressure
February’s Producer Price Index came in stronger than expected, highlighting that inflation pressures are still working their way through the system. Core wholesale prices showed meaningful monthly gains, climbing by .7% up to a 3.4% annualized pace. This indicates that businesses are continuing to face higher input costs.
Historically, these costs tend to be passed along to consumers, which can stall or even reverse progress on consumer inflation. This report follows a pattern we have seen in recent months where inflation improves in some areas but remains sticky in others. For interest rates, persistent producer-level inflation reduces the likelihood of near-term Fed easing and keeps upward pressure on bond yields and mortgage rates.
3️⃣ Spring Housing Demand Meets Rising Mortgage Rates
The spring housing market is beginning to pick up, with increased buyer activity and new listings coming online. However, this seasonal momentum is being met with a sharp rise in mortgage rates, creating a challenging environment for both buyers and sellers.
Since the escalation of the Iran conflict, mortgage rates have moved noticeably higher, reducing affordability right as demand typically strengthens. This dynamic is likely to slow transaction volume and keep pressure on home prices in certain segments. While demand fundamentals remain intact due to limited inventory and demographic support, higher financing costs are clearly becoming the dominant factor shaping market activity.
💡Rates & Market Outlook
Bottom Line:
Mortgage rates are showing no signs of slowing their upward movement. Since the beginning of the conflict in Iran, we have seen an increase of approximately 0.625%. Until we see stability return to the markets, we recommend maintaining a locking bias.
March 16, 2026
1️⃣ Inflation Holds Steady but Remains Sticky
The February Consumer Price Index report showed inflation rising 2.4% year over year, exactly as economists expected. While this suggests inflation is no longer accelerating, several underlying components remain stubbornly elevated. Shelter costs and services inflation continue to run hotter than the Federal Reserve would like, keeping overall inflation pressure in the system.
Another growing concern is energy. Oil prices have moved higher in recent weeks due to geopolitical tensions in the Middle East. Rising energy costs tend to spread through the economy, increasing transportation, manufacturing, and consumer prices. Even if inflation appears stable today, higher energy prices will push future readings higher.
For mortgage markets, the key takeaway is that higher inflation rates due to rising oil prices are on their way.
2️⃣ The Next Fed Chair May Inherit a Difficult Economy
Kevin Warsh is widely expected to become the next Federal Reserve Chair, but the economic environment he may inherit could be challenging. Inflation pressures remain present while recent economic data suggests the labor market may be softening.
The loss of jobs reported last month has raised concerns that economic momentum may be slowing. If inflation stays elevated while growth weakens, the Fed could face a difficult balancing act between controlling inflation and supporting the economy.
Warsh has historically taken a firm stance on inflation. If that approach continues under his leadership, financial markets may need to prepare for interest rates remaining higher for longer than many investors expect.
3️⃣ Oil Prices Reignite Inflation Concerns
Oil prices have surged in recent weeks as global energy markets react to geopolitical tensions and fears of supply disruptions. Concerns surrounding Middle East conflict and potential shipping disruptions have pushed crude prices sharply higher.
Higher oil prices tend to ripple through the entire economy. Transportation, manufacturing, and consumer goods all become more expensive, which can reignite inflation pressures. Historically, sharp increases in oil prices have often been followed by broader inflation increases.
For financial markets, rising oil prices often lead to higher Treasury yields as investors begin pricing in future inflation risk. Mortgage rates typically move in the same direction.
💡Rates & Market Outlook
Bottom Line:
With oil prices rising, so are expectations of consumer inflation. Not only can we expect to pay more at the gas pump, consumer goods and services are also increasing in price. Mortgage loans are no exception. The good news is that mortgage bonds are back above their 200-day moving average. If this level holds, there is no immediate rush to lock on loans needing to close quickly. However, lock quickly should we break beneath this critical level.
March 09, 2026
1️⃣ Bond Market Questions Whether the Fed Will Cut Rates in 2026
Expectations for Federal Reserve rate cuts this year continue to fade as bond traders reassess the outlook for inflation and economic growth. Just a few months ago, markets were pricing in multiple rate cuts for 2026. Today, the probability of the Fed making no cuts at all this year has risen significantly. Investors are increasingly concerned that inflation pressures are proving more persistent than expected, especially with energy prices climbing and supply chain risks tied to geopolitical tensions. Treasury yields have responded by moving higher, reflecting the market’s belief that short term interest rates may need to remain elevated longer than previously thought.
For mortgage borrowers, this shift in expectations matters. Mortgage rates tend to follow long term Treasury yields, so if the bond market continues to believe that the Fed will keep policy tight, it limits the ability for mortgage rates to move meaningfully lower in the near term.
2️⃣ Home Sellers Relisting Properties at the Fastest Pace in a Decade
The housing market is showing signs of strain as more homeowners are relisting their properties after failing to secure a buyer. Recent data shows that homes are being relisted at the fastest pace seen in roughly ten years. In many cases, sellers initially entered the market with aggressive pricing based on expectations from the pandemic housing boom. With affordability now stretched due to higher mortgage rates, many buyers have become more cautious, forcing sellers to pull listings and reenter the market at lower prices or with improved terms.
This dynamic is gradually increasing housing inventory in several markets and creating more negotiation power for buyers. While housing supply remains historically tight, the rise in relistings is a sign that the market is slowly moving toward better balance between buyers and sellers. For the mortgage industry, this shift could translate into more transaction activity as pricing becomes more realistic and buyers reengage.
3️⃣ Weak Jobs Report Raises Stagflation Concerns
Friday’s Bureau of Labor Statistics report delivered a major surprise and not in a good way. Instead of the expected gain of roughly 60,000 jobs, the U.S. economy lost 92,000 jobs in February. At the same time, the unemployment rate climbed from 4.3% to 4.4%. This creates a difficult situation for the Federal Reserve.
On one hand, inflation pressures remain elevated, particularly with oil prices moving higher due to the ongoing conflict involving Iran and risks to global energy supply. On the other hand, a weakening labor market suggests the economy may be slowing faster than policymakers anticipated.
When rising inflation occurs alongside slowing economic growth and increasing unemployment, economists refer to the environment as stagflation. Historically, stagflation has been one of the most challenging conditions for policymakers to manage and it often leads to higher long-term interest rates.
💡Rates & Market Outlook
Bottom Line:
Rising oil prices continue to increase inflation expectations across global markets. Escalating tensions involving Iran have already pushed energy prices higher and driven Treasury yields upward as investors price in the risk of sustained supply disruptions.
If the United States is unable to end the conflict quickly, energy costs could continue climbing, which historically places upward pressure on both inflation and long-term interest rates. Markets are already responding to these risks, with bond yields and mortgage rates edging higher as investors reassess the inflation outlook. For now, we begin the week maintaining our locking bias.
March 02, 2026
1️⃣ Geopolitical Tension and Oil Market Volatility
The recent attack on Iran has immediately raised concerns about global energy supply and economic stability. Iran remains one of the world’s largest oil producers within OPEC, exporting roughly 2 to 3 million barrels per day. Any disruption to that supply, or even the threat of disruption through the Strait of Hormuz where nearly one fifth of global oil flows, has the potential to push crude prices higher. Markets tend to react quickly to uncertainty in the Middle East, and we have already seen increased volatility in oil futures as traders assess the risk of escalation.
Higher oil prices ripple through the broader economy. Energy costs affect transportation, manufacturing, and ultimately consumer prices. If crude sustains a meaningful move higher, it can add upward pressure to inflation at a time when the Federal Reserve is still trying to keep price growth under control. For mortgage rates, this creates a tricky environment. Geopolitical risk can drive investors toward the safety of U.S. Treasury bonds, which typically helps rates.
However, if oil driven inflation expectations rise, that can offset some of the benefit. The net effect will depend on whether markets focus more on economic slowdown risk or renewed inflation pressure.
2️⃣ Tariffs, Tax Policy and the Broader Economic Impact
The administration is currently engaged in a legal fight related to tariff refund delays, while also floating the idea that tariffs could substantially replace income taxes. That is a significant policy discussion with real economic implications, including the near term direction of mortgage interest rates. Tariffs function as a tax on imported goods, and while they may generate federal revenue, they are ultimately paid by businesses and consumers in the form of higher prices. Policy experts have pointed out that replacing a broad based income tax with tariffs would likely require extremely high import taxes, which could drive up consumer costs and invite retaliation from trading partners.
From a housing and mortgage perspective, trade policy matters. Tariffs can increase the cost of building materials such as lumber, steel, and appliances. That feeds directly into home prices and construction costs. In addition, aggressive trade measures can slow global growth, disrupt supply chains, and create financial market volatility. Bond markets tend to respond quickly to any policy that could alter inflation expectations or economic growth trajectories.
If tariffs contribute to higher prices, that may keep inflation stubborn and limit how much mortgage rates can fall. On the other hand, if trade tensions dampen economic activity, that could eventually create downward pressure on rates. As always, policy uncertainty translates into market volatility.
3️⃣ Wholesale Inflation Surges Above Expectations
Core wholesale prices rose a whopping 0.8% in January, well above forecasts. On a year over year basis, producer level inflation is running hotter than many economists anticipated. The Producer Price Index is an important leading indicator because it reflects the costs businesses face before those costs are passed on to consumers. When wholesale prices accelerate, there is a risk that consumer inflation will follow.
This stronger than expected reading complicates the Federal Reserve’s path forward. After several rate cuts over the past year, markets were hopeful that inflation was steadily trending back toward the Fed’s 2% target. A sharp increase in core producer prices suggests that price pressures may not be fully contained. For mortgage rates, inflation data is critical. Bond investors demand higher yields when inflation risks rise, which pushes mortgage rates higher. If upcoming consumer inflation reports confirm what we are seeing at the wholesale level, it could reduce the likelihood of near term rate cuts and keep mortgage rates elevated for longer than many had hoped.
💡Rates & Market Outlook
Bottom Line:
As we move into March, markets will be closely watching developments in the Middle East, trade policy discussions in Washington, and incoming inflation data. Each of these factors has the potential to influence the direction of mortgage rates in the weeks ahead.
In the meantime, mortgage rates are on the rise. We will begin the week with a locking bias but holding onto hope that markets will stabilize quickly.
Feb 23, 2026
1️⃣ PCE Inflation Reaccelerates at Year End
The latest reading on the Federal Reserve’s preferred inflation gauge confirmed that the inflation battle is not finished. Core PCE rose 0.4% in December, pushing the year over year rate back up to 3.0% from 2.8% the prior month. Headline PCE also moved higher, running near 2.9% annually.
That is not the direction policymakers want to see if the goal is steady progress toward 2%. What matters most for rates is the trend, and the monthly acceleration suggests inflation remains sticky beneath the surface. When inflation firms up, markets quickly reassess the likelihood and timing of Fed rate cuts. As a result, bond yields tend to move higher, and mortgage rates follow. Inflation continues to be the primary driver of mortgage pricing in the current environment.
2️⃣ Trade Policy Volatility Returns
Trade policy has once again injected uncertainty into financial markets. After the Supreme Court limited broad executive tariff authority, the expectation was for some stabilization. However, the administration has signaled it may pursue alternative avenues that could result in a nearly global 15% tariff on imported goods. Even the potential for expanded tariffs introduces uncertainty around costs, supply chains, and consumer pricing.
Tariffs effectively act as a tax on imports, and while the long term objective may be to strengthen domestic production, the near term impact can show up in higher prices. Markets do not respond well to unpredictability, especially when it affects inflation expectations. The renewed trade discussion has added another layer of volatility to both equities and fixed income markets.
3️⃣ GDP Slows Sharply and Raises Stagflation Concerns
The advance estimate for fourth quarter GDP showed growth of just 1.4% annualized. That is a meaningful slowdown from the prior quarter, which expanded at 4.4%. The deceleration reflects softer business investment, cooling government spending, and moderating export activity, even as consumer spending remains relatively steady. Slower GDP on its own would normally help bond markets, since cooling growth can reduce inflation pressures.
The concern today is that inflation is rising at the same time growth is slowing. That combination is the early setup for stagflation, which describes an economy experiencing sluggish growth alongside persistent inflation. Stagflation is difficult for mortgage rates because bonds do not get the full benefit of a clean slowdown.
The Fed cannot cut aggressively if inflation remains elevated, which can keep mortgage rates higher than many would expect in a softening economy. It also increases day to day volatility as markets struggle to determine which force will dominate.
💡Rates & Market Outlook
Bottom Line:
With inflation reaccelerating, GDP slowing sharply, trade policy in flux, and geopolitical tensions building, the market backdrop remains fragile. While we may see temporary improvements when investors seek safety, those gains can reverse quickly if inflation surprises to the upside or global risks escalate.
Mortgage rates are sitting on a strong floor that has proven to be strong resistance to allowing rates to fall further. Given this risk, the prudent advice is to suggest locking. However, if rates can break this floor, we will see rates lower than we have had in years.
Feb 17, 2026
1️⃣ Jobs Report Shows Resilience, But Underlying Weakness Persists
The January jobs report surprised to the upside with nonfarm payrolls rising by about 130,000 and the unemployment rate dipping to around 4.3 percent, slightly better than expectations and a sign that labor market conditions remain resilient to start 2026. Job gains were concentrated in sectors like health care, social assistance, construction and professional services, while government and some services industries shed workers. Wages showed measured growth, sustaining consumer income and spending power.
However, revisions to prior years revealed that total job creation in 2025 was much lower than previously thought, suggesting that underlying labor demand slowed significantly even as headline figures appear sturdy. Market reactions reflected this nuance, with equities and bond yields initially moving in opposition before settling back as investors weighed the implications for monetary policy.
2️⃣ Treasury Yields Drift Lower Ahead of Inflation Data
In the Treasury market, yields edged lower last week as investors positioned themselves ahead of key inflation data, particularly the upcoming consumer price index release. The 10-year Treasury yield settled near roughly 4.05 percent, down from higher levels earlier, reflecting cautious sentiment and expectations that softer inflation could support a slower pace of future rate adjustments.
This movement in yields underscores how bond markets are balancing strong labor data against signs of moderating price pressures, with inflation readings that may yet validate expectations for rate cuts in the middle of the year if disinflation continues. The shift in yields also influenced safe-haven flows and contributed to broader volatility across stocks and commodities.
3️⃣ Rates and Refinancing Considerations
The recent pullback in yields has brought interest rates down toward multi-year lows, offering an attractive window for locking in financing improvements. With current support levels limiting more meaningful declines, it’s a favorable moment to secure rates, especially those with lower upfront fees that preserve flexibility.
This approach positions borrowers to take advantage of potential future drops in rates once inflation prints and economic trends evolve over the coming months. Continuing to monitor both macroeconomic data and monetary policy signals will be essential in timing refinances that optimize cost savings without sacrificing optionality.
💡Rates & Market Outlook
Bottom Line:
If you have the patients and are ready to pull the lock trigger should market sentiment reverse, you may want to begin the week cautiously floating to see if rates can take another step lower.
Feb 09, 2026
1️⃣ Global Uncertainty and Investor Caution
More investors are starting to focus on protecting their money rather than growing it, which usually happens when confidence in the broader economic outlook starts to fade. High government debt, ongoing budget deficits, and rising geopolitical risks are making markets more sensitive to bad news.
This does not mean a crisis is imminent, but it does suggest that market swings could become more common. Bonds often benefit during periods of uncertainty, but that support tends to come in waves. Until economic growth slows more clearly or inflation cools further, mortgage rates are likely to stay within their current range rather than move sharply lower.
2️⃣ Early Signs of Labor Market Softening
The job market continues to cool, even though the top level numbers still appear relatively stable. Hiring has slowed, finding a new job is taking longer, and layoffs are gradually increasing across several industries. This is typically how labor market weakness begins. Employers pull back on hiring first before making deeper cuts.
The Federal Reserve is watching these trends closely, but they have a history of reacting after conditions have already changed. Right now, labor data is soft enough to prevent rates from rising significantly, but not weak enough to push them lower in a meaningful way.
3️⃣ Affordability Remains a Major Housing Challenge
Housing affordability remains a major hurdle for buyers. For today’s median priced home to be as affordable as it was in 2019, household incomes would need to be about $50,000 a year higher. That gap shows how much home prices and interest rates have outpaced wage growth.
As a result, buyer demand remains limited and overall housing activity stays muted. These affordability pressures can eventually help bring rates lower, but that process usually takes time. Until either incomes rise or rates fall more noticeably, the housing market will continue to feel constrained.
💡Rates & Market Outlook
Bottom Line:
This week brings important labor and inflation reports that could influence short term rate movement. With mortgage bonds trading in a very tight range, the potential benefit of floating is limited while the risk of volatility remains. For most borrowers, locking remains the more prudent choice for those needing to close soon.
Feb 02, 2026
1️⃣ Federal Reserve Holds Steady as Labor Market Signals Begin to Shift
As expected, the Federal Reserve chose to hold off on making an additional cut to the Fed Funds Rate. The decision itself was not surprising, but the reasoning behind it is worth watching closely. On the surface, the labor market is still holding together. Weekly unemployment claims remain contained and have not yet reached levels that would cause immediate concern. Beneath the surface, however, job seekers are clearly having a harder time finding new employment, which is often the first sign that momentum is slowing.
Historically, this phase is followed by reduced hours and eventually layoffs. If the Fed waits too long to respond to this shift, it risks falling behind the curve and being forced into more aggressive action later. That said, over the past three years the Fed has navigated a difficult path reasonably well, managing to fight inflation without breaking the labor market. Whether that balance can be maintained from here remains an open question.
2️⃣ Dollar Weakness Adds Pressure to Mortgage Rates
The US dollar continues to experience notable weakness, trading in a range near levels last seen in early 2022. Over the past twelve months, the dollar has declined by roughly eleven percent, marking its worst annual performance since 2017. President Trump has publicly expressed comfort with a weaker dollar, emphasizing that it makes US goods more competitive overseas.
Markets have not taken that message lightly. A perceived tolerance for continued dollar devaluation has added to selling pressure, especially at a time when tariff threats and aggressive trade rhetoric have increased concerns around retaliation. Countries that hold large amounts of US Treasuries could respond by reducing exposure, which would push yields higher. A stronger dollar would help ease inflationary pressure and support lower mortgage rates. If the goal is to bring market driven interest rates down, fiscal discipline and reduced deficit spending need to be part of that conversation.
3️⃣ Consumer Confidence Slides as Uncertainty Builds
Consumer confidence in the US fell sharply in January, reaching its lowest level since mid-2022. This decline reflects growing unease around job security, higher living costs, and uncertainty surrounding economic policy. When consumers become more cautious, discretionary spending slows, which can ripple through the broader economy. Housing activity often feels this shift early, as buyers delay major financial decisions when confidence erodes. While weaker confidence can eventually help bring inflation and interest rates down, the near term impact is often increased volatility in both equity and bond markets. Until consumers feel more certain about employment and economic stability, markets are likely to remain reactive to every new data point.
💡Rates & Market Outlook
Bottom Line:
Given the current level of uncertainty and market volatility, floating carries elevated risk. If you have a loan closing in the near term, locking may be the prudent move to protect against potential deterioration in mortgage pricing.
Jan 26, 2026
1️⃣ Fed Policy Remains Data Driven, Not Political
The Federal Reserve is facing renewed public pressure to cut rates, but policy decisions continue to be driven by economic data rather than political influence. With inflation still above the Fed’s long-term target and the economy holding together better than many expected, officials appear comfortable keeping rates unchanged for now. This matters for borrowers because it reinforces the idea that mortgage rates are unlikely to fall sharply simply due to political rhetoric.
While rate cuts remain possible later this year, the Fed is signaling patience and discipline. With that in mind, expectations should be tempered for this week’s Fed meeting, as the first-rate decision of 2026 is widely expected to result in no change.
2️⃣ Inflation Progress Continues, But Not Fast Enough
The Fed’s preferred measure of inflation showed prices running at 2.8 percent in November. That is a meaningful improvement from the highs of the past few years, but it remains above the level the Fed considers consistent with long term price stability. This lingering inflation pressure is one of the main reasons policymakers are hesitant to move too quickly on rate cuts.
For mortgage markets, inflation stuck near this level tends to cap how fast bond markets can improve. The trend is moving in the right direction, but the pace remains slow, which explains why rate relief continues to arrive in fits and starts rather than all at once.
3️⃣ Housing Affordability Remains a Central Economic Challenge
Housing affordability continues to sit at the center of economic discussions both in the U.S. and abroad. Elevated mortgage rates combined with limited housing supply remain significant obstacles for buyers, especially first-time homeowners. While easing tariff concerns have helped calm bond markets modestly, broader fiscal and geopolitical uncertainties continue to weigh on confidence.
The takeaway for housing is not a sudden reset, but a gradual adjustment. Affordability is likely to improve incrementally as rates drift lower and incomes grow, but patience will remain a requirement for both buyers and sellers navigating today’s market.
💡Rates & Market Outlook
Bottom Line:
With threats of additional tariffs easing, the bond market is showing early signs of stabilization. We will begin the week with a cautious floating stance. That said, markets remain highly sensitive to incoming data and shifting sentiment. If you are approaching a closing date, it may make sense to lock to protect against sudden moves higher in rates.
Jan 20, 2026
1️⃣ Inflation and Price Data Reinforce Mixed Signals
Last week’s inflation data showed that price pressures remain persistent but are continuing to moderate. Consumer inflation came in largely in line with expectations, with prices rising 0.31 percent in December and the annualized rate landing at 2.68 percent. When stripping out volatile food and energy prices, core inflation increased 0.24 percent for the month, bringing the annualized core rate to 2.6 percent.
Given the ongoing price pressures tied to tariffs, this data supports the idea that the Fed’s previous rate cuts have not reignited inflation. This should help keep the Fed on track for two or more rate cuts in 2026, assuming inflation continues to behave.
2️⃣ Central Bank Messaging Remains Cautious
With the next Federal Reserve rate announcement scheduled for January 28th, markets have tempered expectations for any immediate rate cuts. Federal Reserve Vice Chair Philip Jefferson reiterated that policy is likely to remain unchanged at this meeting, emphasizing that both inflation trends and labor market conditions will determine future moves. His comments reinforced the Fed’s commitment to remaining data dependent rather than following a predetermined path.
While there are clear signs that the labor market is weakening, new unemployment claims remain relatively low. This suggests that although it has become more difficult for job seekers to find new employment, employers are still hesitant to lay off existing workers. Should unemployment claims make a meaningful move higher, it would likely prompt the Fed to adopt a more aggressive rate cutting posture.
3️⃣ Tariff Legality Remains Unresolved
The U.S. Supreme Court has once again delayed its expected ruling on whether tariffs imposed on U.S. trading partners fall within the legal authority used to justify them. No reason has been given for the delay, and there is currently no firm timeline for when a decision will be released. This uncertainty is adding anxiety to the bond market, which is never helpful for interest rate stability.
While tariffs have contributed to higher prices in certain areas, the potential inflation relief from removing them is offset by another concern. If tariffs are deemed illegal, the U.S. Treasury could be forced to replace lost revenue, further expanding government deficits. Increased deficit spending would likely push bond yields higher, which could quickly translate into higher mortgage rates. Markets are eager for clarity, as direction is badly needed.
Threats of additional tariffs and rising geopolitical tensions have already caused mortgage rates to move higher. Mortgage bonds are now trading back near the levels seen before the announcement that Fannie Mae and Freddie Mac would purchase $200 billion in mortgage backed securities.
💡Rates & Market Outlook
Bottom Line:
Given the current volatility and headline risk, we are leaning toward a locking bias.
