The average 30-year fixed rate mortgage was 6.53% yesterday, a decrease of 0.01% since the day before. The 15-year fixed mortgage rate stood at 5.7%, down by 0.02%. The 30-year FHA mortgage averaged 5.87% yesterday, having dropped by 0.02. Meanwhile, the 30-year jumbo mortgage rate was 6.59%, reflecting a decrease of 0.02%.
The bigger picture
Mortgage rates edged lower yesterday. That was probably a result of Monday's main economic report falling below market expectations.
Yesterday, we mentioned Wednesday afternoon's release of the latest minutes of the Federal Reserve's rate-setting committee. Bloomberg reminded us that two U.S. Treasury auctions might also affect mortgage rates: one tomorrow for 10-year notes and another on Thursday for 30-year bonds.
High demand at these auctions could send mortgage rates lower. But low demand might cause those rates to rise.
No economic reports are scheduled for today.
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Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.53% | 6.57% | -0.01% | -0.05% |
| 15-Year Fixed | 5.7% | 5.76% | -0.02% | -0.04% |
| 30-Year Fixed FHA | 5.87% | 7.09% | -0.02% | -0.05% |
| 30-Year Fixed VA | 6% | 6.16% | -0.01% | -0.06% |
| 30-Year Fixed USDA | 5.97% | 6.13% | +0.04% | -0.01% |
| 30-Year Fixed Jumbo | 6.59% | 6.6% | -0.02% | -0.22% |
| 5/6 Year ARM | 6.09% | 6.16% | -0.05% | +0% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.58% | 6.61% | -0.02% | -0.07% |
| 15-Year Fixed | 5.67% | 5.73% | +-0% | -0.04% |
| 30-Year Fixed FHA | 5.87% | 7.08% | -0.02% | -0.05% |
| 30-Year Fixed VA | 6.02% | 6.11% | +-0% | -0.04% |
| 5/6 Year ARM | 6.06% | 6.13% | -0.05% | -0.3% |
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 move 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."
Comerica Bank's weekly preview
On Monday, Comerica Bank published its weekly preview:
"The minutes of the Federal Open Market Committee’s June meeting will draw more scrutiny than usual after Chair Warsh shortened the policy statement and eliminated forward guidance from it. The minutes will likely drop their usual description of policymakers’ opinions about their next step for rates, paralleling the leaner statement. In the absence of forward guidance, the discussion of the inflation outlook has the most potential to influence financial markets’ pricing of the Fed’s next steps."
Mortgage rates today
There are no economic reports on today's MarketWatch economic calendar.
What's next?
No economic reports are scheduled for release today 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, Wednesday and Thursday's Treasury auctions might affect mortgage rates. Economic reports due later this week rarely move those rates.
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.
