The average 30-year fixed rate mortgage was 6.68% yesterday, unchanged since the day before. The 15-year fixed mortgage rate stood at 5.68%, the same as one the day before. The 30-year FHA mortgage averaged 5.94% yesterday, having stayed the same. Meanwhile, the 30-year jumbo mortgage rate was 6.95%, reflecting no change.
The bigger picture
There are no economic reports on today's calendar, although there are some big ones due later in the week. However, that doesn't necessarily mean that today will be a quiet one for mortgage rates.
Two pieces of economically sensitive news have emerged since markets closed on Friday. And either or both could increase volatility today.
Tariffs
The first was the announcement of "30% tariffs against the European Union [EU] and Mexico starting Aug. 1, a move that could cause massive upheaval between the United States and two of its biggest trade partners," according to the Associated Press (AP). Those were the latest in a series of tariff announcements recently, but these two are particularly important because of the size of America's trade with each of the parties.
Earlier on Friday, Chicago Federal Reserve President Austan Goolsbee said recent tariff announcements had "muddied the inflation outlook," and had made it "more difficult for him to support the rate cuts" that the government has been demanding, according to The Wall Street Journal.
Many economists believe that high tariff rates will cause a spike in inflation, although few claim to know whether that will be transitory or persistent. The prospect of higher inflation pretty much always drives mortgage rates higher.
Fed independence
Speaking of the government's urging of the Fed to cut general interest rates, the second piece of news to emerge on Friday was closely related to that campaign. Officials late last week began to accuse Fed Chair Jerome Powell of misleading Congress when he testified about cost overruns on the Fed's restoration of its headquarters buildings, says The New York Times.
"The latest attempt to undermine the Fed chair comes as the Supreme Court has re-established that the president is limited in his ability to
remove an official at the central bank [the Fed] without cause. That typically has meant serious misconduct and other violations," continued the Times. Misleading Congress might be viewed as serious misconduct and used to justify a firing with cause.
The Fed itself responded quickly to the allegations, posting on its website a set of FAQs that appeared to confirm that Powell's testimony was correct when he gave it.
Markets tend to take the independence of the Fed from government interference seriously. They see it as good for the stability of the economy. So, if investors believe the narrative that an attempt to fire Powell is imminent, that could trigger yet more volatility.
Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.68% | 6.71% | +0% | -0.07% |
| 15-Year Fixed | 5.68% | 5.73% | +0% | -0.07% |
| 30-Year Fixed FHA | 5.94% | 7.14% | +0% | -0.19% |
| 30-Year Fixed VA | 6.05% | 6.2% | +0% | -0.14% |
| 30-Year Fixed USDA | 5.98% | 6.12% | +0% | -0.06% |
| 30-Year Fixed Jumbo | 6.95% | 6.97% | +0% | -0.08% |
| 5/6 Year ARM | 6.72% | 6.75% | +0% | +0% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.77% | 6.8% | +0% | -0.05% |
| 15-Year Fixed | 5.67% | 5.72% | +0% | -0.09% |
| 30-Year Fixed FHA | 5.92% | 7.12% | +0% | -0.19% |
| 30-Year Fixed VA | 6.1% | 6.25% | +0% | -0.14% |
| 5/6 Year ARM | 6.81% | 6.85% | +0% | +0.01% |
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. News items concerning tariffs and deficits are especially influential at the moment.
Mortgage rates today
No economic reports appear on today's MarketWatch economic calendar. That changes tomorrow when the June consumer price index (CPI) is scheduled for release. That is typically one of the two most consequential monthly reports for both markets and mortgage rates.
Markets are especially sensitive to each CPI at the moment as they scan the horizon for signs of higher inflation triggered by tariffs. They're already expecting moderate increases across the board in this report (details tomorrow).
Higher-than-expected inflation numbers typically exert upward pressure on mortgage rates, while lower-than-expected ones tend to push them downward.
After tomorrow, stand by Thursday's retail sales data for June. That and the CPI have the potential to generate most of the action this week.
