Mortgage Rates Today, Apr. 30, 2025: GDP and Inflation. Will Today's Big Data Move Rates?

The bigger picture

Yesterday's consumer confidence index was even worse than expected. The Conference Board, which publishes the index, said it dropped to 86.0, below the 87.3 forecast and March's 93.9.

"Consumer confidence declined for a fifth consecutive month in April, falling to levels not seen since the onset of the COVID pandemic,” said Stephanie Guichard, senior economist, global indicators at the Conference Board. “The decline was largely driven by consumers’ expectations. The three expectation components—business conditions, employment prospects, and future income—all deteriorated sharply, reflecting pervasive pessimism about the future. Notably, the share of consumers expecting fewer jobs in the next six months (32.1%) was nearly as high as in April 2009, in the middle of the Great Recession. In addition, expectations about future income prospects turned clearly negative for the first time in five years, suggesting that concerns about the economy have now spread to consumers worrying about their own personal situations. However, consumers’ views of the present have held up, containing the overall decline in the Index."

To be dipping to lows last seen during the COVID-19 pandemic and the Great Recession is truly dire. And it raises the possibility of other reports falling similarly below market expectations.

That may well be the case for today's gross domestic product (GDP) figures for the first quarter of 2025. Markets are currently expecting growth to shrivel to 0.4% (annualized), way down on the previous quarter's 2.4%.

But the Federal Reserve Bank of Atlanta's GDPNow tool, which was updated yesterday, reckons it could come in at -1.5% after adjusting for imports and exports of gold. That could be a real bombshell of the type markets can't ignore.

More scary yet was a paper published yesterday by Dr. Torsten Sløk, Apollo's chief economist. It concerned Friday's jobs report, which is due Friday. "Importantly, the survey week for the employment report was the week after Liberation Day tariffs were announced," Sløk wrote. "In other words, the establishment survey and the household survey were carried out during a week with extreme levels of uncertainty for businesses. The consensus expects 130K [133,000, according to MarketWatch] jobs created in April. There are significant risks the number is going to be lower, perhaps even negative."

If negative GDP might be a bombshell, negative job numbers could go nuclear.

As we repeat all too frequently, bad data for the economy is often good news for mortgage rates. They tend to fall when numbers are worse than expected.

However, mortgage rates barely moved yesterday following the terrible consumer sentiment figures. That's partly because of reports that tariffs affecting autos might be reduced. That's seen in markets as good for the economy, offsetting Tuesday's bad news. Trade war stories might continue to eclipse data on days when they coincide.

Inflation

Today's other important report concerns inflation in March. It's the personal consumption and expenditures (PCE) price index, which the Federal Reserve regards as the most accurate and reliable inflation report.

Markets expect the PCE index to show price rises continuing to slow in March, which could be good for mortgage rates. And it's less likely to be wrong than most other reports.

Consensus forecasts for these are rarely too far out, partly because this index is a refinement of the consumer price index (CPI), which is published earlier each month. The current CPI would have had to be woefully out for today's report to seriously disappoint.

However, some believe that inflation is experiencing a calm patch before a storm. If tariffs cause prices to spike, as many economists expect, that could send interest rates, including mortgage rates, back higher again.

Coming up

Although economic reports are usually the main drivers of changes to mortgage rates, they're not the only ones. The general mood in markets and economically consequential news can also affect those rates — as we've seen frequently recently.

Here's Comerica Bank's take on what to expect from economic reports during the rest of this week:

"The economy likely contracted in the first quarter on the back of a record trade deficit in goods as importers front-ran tariff hikes. The labor market probably softened in April, with a lackluster increase in employment and an uptick of the unemployment rate. Job vacancies likely fell in March. The ISM Manufacturing PMI is expected to show the sector in contraction for the second consecutive month. ... Vehicle sales are anticipated to take a breather in April after March’s jump to the highest sales in four years."

Mortgage rates today

We laid out today's main economic reports earlier in this article. There's one other that just might get noticed.

That's the ADP employment report for April, which covers only private-sector jobs. Markets are expecting the number of new such jobs created that month to fall to 120,000, down from 155,000 in March. Again, a lower-than-expected number might be good for mortgage rates.

As always, we'll brief you on all this week's important economic reports before they're published.