The average 30-year fixed rate mortgage was 6.45% yesterday, a decrease of 0.1% since the day before. The 15-year fixed mortgage rate stood at 5.64%, down by 0.08%. The 30-year FHA mortgage averaged 5.86% yesterday, having dropped by 0.06. Meanwhile, the 30-year jumbo mortgage rate was 6.57%, reflecting a decrease of 0.11%.
The bigger picture
Mortgage rates tumbled satisfyingly yesterday in response to Sunday's deal between the U.S. and Iran. However, some investors are already questioning just how good the agreement is as rumors and speculation swirl around its still-secret contents.
Even if Sunday's memorandum of understanding proves worthwhile and the Strait of Hormuz re-opens this week, many experts believe it will take a year — possibly longer — for crude oil and gas prices to return to their pre-war levels. Yesterday afternoon, MarketWatch reported that between 1 billion and 1.5 billion barrels of oil had been lost as a result of the conflict.
"Oil markets tend to project forward, so an extended period of an oversupplied oil market, which assumes uninterrupted global oil flows, could push oil prices into the $60s," Rob Thummel, senior portfolio manager at Tortoise Capital, told MarketWatch. But Thummel thought it would take "at least a year for global oil inventories to return to levels such that oil in the [pre-war] $60s is even a possibility."
That prospect is likely to keep inflation and interest rates higher for longer than some expect. And that, in turn, will probably color the two-day meeting of the Federal Reserve's rate-setting committee, which begins today.
Nearly everyone expects the committee to leave general interest rates unchanged when it announces its policy tomorrow. The Fed only indirectly influences mortgage rates.
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 | 6.45% | 6.49% | -0.1% | -0.17% |
| 15-Year Fixed | 5.64% | 5.7% | -0.08% | -0.13% |
| 30-Year Fixed FHA | 5.86% | 7.07% | -0.06% | -0.09% |
| 30-Year Fixed VA | 6.01% | 6.17% | -0.06% | -0.08% |
| 30-Year Fixed USDA | 5.94% | 6.1% | -0.06% | -0.07% |
| 30-Year Fixed Jumbo | 6.57% | 6.59% | -0.11% | -0.22% |
| 5/6 Year ARM | 6.18% | 6.25% | +0.09% | -0.01% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.51% | 6.55% | -0.08% | -0.16% |
| 15-Year Fixed | 5.63% | 5.69% | -0.07% | -0.12% |
| 30-Year Fixed FHA | 5.86% | 7.07% | -0.06% | -0.09% |
| 30-Year Fixed VA | 6.02% | 6.17% | -0.06% | -0.07% |
| 5/6 Year ARM | 6.07% | 6.12% | -0.1% | -0.32% |
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
April's price indices (the CPI, PPI, IPI and PCE) tend to lend weight to pessimistic arguments about future inflation rates. May's consumer price index and producer price index, published on Jun. 10 and 11, respectively, were even worse than April's.
Those reports 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.
The next meeting of the Fed's rate-setting body is scheduled for today and tomorrow. But last night, the CME FedWatch tool put the chances of general interest rates remaining unchanged at 98.5%, the same as on Sunday night.
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."
Comerica Bank's weekly preview
On Monday, Comerica Bank published its weekly preview:
"The Federal Reserve is expected to hold the federal funds target steady at a range of 3.50% to 3.75% at their June 17 decision, incoming Chair Kevin Warsh’s first. Their policy statement will welcome the pickup in job growth so far this year—Payrolls averaged a gain of over 100,000 per month through May, up from 10,000 per month in 2025. The statement also will acknowledge that inflation has risen further from their 2% target due to energy prices. On core inflation, they will likely be encouraged by cool core goods prices in recent reports, but concerned by the pickup of services price inflation excluding housing. In the June Dot Plot, the median forecast for inflation at year-end will likely rise, while the unemployment rate estimate should edge lower. On rates, a few more Dots on the Plot are likely to indicate members see a hike as likelier than a cut by the end of 2027. Even so, the June meeting’s core message will likely be that the Fed expects to hold rates steady at the next few decisions.
"The first activity indicators for May are expected to be mixed. Industrial production likely rose solidly on higher manufacturing and mining output. Retail sales growth is expected to be moderate, with higher spending on new cars and gasoline but cool growth in other categories. Housing data are likely to be mixed. Starts and building permits are expected to hold on trend and point to subdued building this summer. Homebuilder sentiment is expected to improve, though, good news for the outlook. The pending home sales index should point to further modest gains for existing home sales ahead, too."
Comerica's predictions often differ from market expectations, which are based on a consensus of a wider pool of analysts' forecasts.
Mortgage rates today
There are two economic reports on today's MarketWatch economic calendar. However, neither of them typically affects mortgage rates much.
Here are what markets are expecting from each of this morning's two reports:
- May housing starts — Markets expect these to total 1.4 million (annualized), fewer than April's 1.5 million
- May import prices — Markets expect these to increase more slowly than in April: by 0.8% compared with 1.9%
Typically, worse-than-expected numbers in a report are better for mortgage rates, while better-than-expected ones tend to push those rates higher, all other things being equal. When numbers come in as expected, mortgage rates rarely move far.
This week's star report reveals retail sales in May and is scheduled for tomorrow. We're due the Fed's rate announcement the same day.
