Mortgage Rates Today, June 8, 2026: Rates Climbed on Surprisingly Strong Jobs Report

The bigger picture

Last Friday's jobs report surprised markets. They'd been expecting 80,000 new jobs to have been created in May. But the actual number was 172,000.

Regular readers won't be surprised that mortgage rates moved higher on good economic news; we tell them daily that's normal. But why did stock indices fall?

It's because the jobs report made a Federal Reserve rate hike more likely. Congress obliges the Fed to balance and optimize employment and inflation.

When inflation is uncomfortably high and employment is strong, as they currently are, the Fed struggles to resist calls for rate hikes. So far, few investors are expecting an increase in general interest rates at the next meeting of the Fed's rate-setting committee on Jun. 17, according to the CME FedWatch tool.

But many more are pricing in a hike at some point this year. Until recently, everyone was expecting cuts. Let's hope May's consumer price index, due Wednesday, shows year-over-year inflation cooling, but few are expecting that.

The Fed doesn't directly dictate mortgage rates. But it certainly does influence the bond market that does determine those rates.

Rising tensions in the Middle East over the weekend may exert upward pressure on mortgage rates today.

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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.

SIFMA warned in an e-newsletter on May 29: "Treasury yields [which mortgage rates typically track] could continue to rise even if the Iran war ends, as the primary driver of the recent increase in yields has been real yields, not inflation expectations. While oil prices and Treasury yields have moved in tandem recently, the correlation is weakening, and investors should focus on other factors, such as the Federal Reserve's actions and government debt issuance."

You might have noticed worrying reports in the financial press about the likelihood of inflation getting worse. For example, in an e-newsletter on May 10, The Economist wrote, "The Iran war is already causing pain for American motorists, who are paying more than $4.50 a gallon for petrol. Now Americans face a grocery-price shock."

On May 11, MarketWatch had similar concerns: "The surge in gasoline prices tied to the Iran war is set to drive U.S. inflation to a three-year high — and it might get worse before it gets better.

" ... That’s not the only downside of higher inflation," the report continued. "The increase in prices has handcuffed the Federal Reserve. The central bank is likely to be stymied from cutting interest rates aggressively, leaving the cost of borrowing painfully high for prospective home buyers and anyone who needs a big loan."

The Fed

April's price indices (the CPI, PPI, IPI and PCE) tend to lend weight to these pessimistic arguments. And they landed well after the last meeting of the Federal Reserve's rate-setting committee. Minutes of that 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.

Bond markets vs. stock markets

Mortgage rates are largely dictated by 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 no economic reports on today's MarketWatch economic calendar.

But strap in for May's consumer price index (CPI), due Wednesday. It sometimes rivals the jobs report's influence, especially at times like this when inflation is such a hot topic. Its baby brother, the producer price index (PPI), is scheduled for Thursday.

Besides those, the ever-changing likelihood of peace in the Middle East is likely to cause most movements in mortgage rates this week.