The average 30-year fixed rate mortgage was 6.54% yesterday, unchanged since the day before. The 15-year fixed mortgage rate stood at 5.71%, the same as one the day before. The 30-year FHA mortgage averaged 5.9% yesterday, having stayed the same. Meanwhile, the 30-year jumbo mortgage rate was 6.61%, reflecting no change.
The bigger picture
Mortgage rates start out this morning moderately higher than they were a week ago. That's probably down to market jitters about the durability of the Middle East memorandum of understanding, which seems to be more honored in the breach than the observance by both sides.
Friday's disappointing jobs report provided some welcome relief, sending mortgage rates lower. Regular readers know that unexpectedly poor economic data typically exert downward pressure on those rates.
It's a relatively light week for economic reports, and the event most likely to move mortgage rates is probably Wednesday afternoon's release of the latest minutes of the Federal Reserve's rate-setting committee. However, today's release of purchasing managers' indices (PMIs) for the services sector might be the second-most-important driver of rate changes this week.
Scroll on down for details of today's economic reports and how they might affect mortgage rates.
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Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.54% | 6.58% | +0% | -0.04% |
| 15-Year Fixed | 5.71% | 5.78% | +0% | -0.02% |
| 30-Year Fixed FHA | 5.9% | 7.11% | +0% | -0.03% |
| 30-Year Fixed VA | 6.02% | 6.18% | +0% | -0.05% |
| 30-Year Fixed USDA | 5.93% | 6.09% | +0% | -0.05% |
| 30-Year Fixed Jumbo | 6.61% | 6.63% | +0% | -0.2% |
| 5/6 Year ARM | 6.13% | 6.2% | +0% | +0.05% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.6% | 6.63% | +0% | -0.05% |
| 15-Year Fixed | 5.67% | 5.73% | +0% | -0.04% |
| 30-Year Fixed FHA | 5.89% | 7.11% | +0% | -0.03% |
| 30-Year Fixed VA | 6.02% | 6.11% | +0% | -0.04% |
| 5/6 Year ARM | 6.11% | 6.18% | +0% | -0.25% |
What's 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 the war, employment, inflation, tariffs, and deficit funding are especially influential at the moment.
The Fed
May's price indices (the CPI, PPI, IPI and PCE) tend to lend weight to pessimistic arguments about future inflation rates.
And those reports landed either side the last meeting of the Federal Reserve's rate-setting committee. We're due the minutes of the Jun 16-17 meeting on Wednesday.
Minutes of the previous (April 28-29) meeting were published on May 20 and included the following:
"Almost all participants noted that there was a risk that the conflict in the Middle East could persist for an extended period or that, even after the conflict ended, the prices of oil and other commodities could remain elevated for longer than expected. In such scenarios, these participants expected continued upward pressure on inflation arising from supply chain disruptions, high energy prices, or the pass-through of higher input costs to other prices. The vast majority of participants noted an increased risk that inflation would take longer to return to the Committee’s 2 percent objective than they had previously expected."
Bottom line: "A majority of participants highlighted ... that some policy firming would likely become appropriate if inflation were to continue to run persistently above 2 percent." Policy firming is Fedspeak for a rate hike.
We'll update this section on Thursday. But events surrounding the June meeting showed committee members all but ruling out a further cut to general interest rates this year. And almost half of them now expect a hike in 2026.
The Fed doesn't directly set new fixed-rate mortgage rates. But the factors that influence its decisions (and to a lesser extent the decisions themselves) certainly do influence those rates
Bond markets vs. stock markets
Mortgage rates are largely dictated by the yields on a type of bond, the mortgage-backed security (MBS). So, we focus on bond markets.
On May 7, The New York Times explored why stock markets and bond markets have been behaving so differently from each other since the start of the conflict in the Middle East.
Investors in stocks have been wagering that U.S. companies will continue to generate large profits during the conflict. And the stock market typically cares only about whether dividends and company values will continue to rise.
"But the bond market is another matter," said The Times. "Bond traders have maintained a much sharper focus on risk. Yields remain correlated with shifts in the price of oil. As oil prices have spiked and inflation has risen, yields have risen and bond prices, which move in the opposite direction, have fallen."
Mortgage rates today
There are three economic reports on today's MarketWatch economic calendar. All of them are June purchasing managers' indices (PMIs) for the services sector.
PMI's are useful gauges of the coming vitality of a sector because they reflect the level of sourcing activity within that sector as organizations buy in what they'll need in the coming months. Typically, PMIs from the Institute for Supply Management (ISM) are the ones that affect mortgage rates most.
Here are market expectations for today's PMIs:
- June ISM Report on Business Services PMI — Markets expect a 54.3 index reading, down from May's 54.5
- June US Services PMI — No market expectations published. The PMI was 50.7 in May
- June Global Services PMI — No market expectations published. The PMI was 51.3 in May
Typically, worse-than-expected numbers in a report are better for mortgage rates, while better-than-expected figures tend to push those rates higher, all other things being equal. When numbers come in as expected, mortgage rates rarely move far.
What's next?
No economic reports are scheduled for release tomorrow or on Friday. This week's big event is Wednesday's release of the Federal Open Market Committee (FOMC, the Fed's rate-setting body) minutes for its Jun. 16-17 meeting.
Besides those and today's PMIs, we'll be surprised if this week's reports generate ripples, let alone waves.
However, events in the Middle East continue to hang over markets like the sword of Damocles. News that makes a final peace deal appear more likely will probably drive mortgage rates lower, while escalating tensions could send them higher.
