The average 30-year fixed rate mortgage was 6.57% yesterday, an increase of 0.09% since the day before. The 15-year fixed mortgage rate stood at 5.76%, up by 0.08%. The 30-year FHA mortgage averaged 5.89% yesterday, having risen by 0.03. Meanwhile, the 30-year jumbo mortgage rate was 6.7%, reflecting an increase of 0.05%.
The bigger picture
Mortgage rates rose quite sharply yesterday, despite the usual signals suggesting a fall should have occurred. Since the Middle East conflict began at the end of February, those rates have fairly faithfully (but not invariably) shadowed oil prices.
You can see why. Bondholders (whose trading in one type of bond dictates mortgage rates) buy a fixed income, and every time prices rise, the value of their income falls. Oil prices are a major driver of inflation, and they fell yesterday on hopeful news from the peace talks between the U.S. and Iran in Bürgenstock, Switzerland, including the immediate waiving of sanctions on Iranian oil.
So, why did mortgage rates break from oil prices and rise yesterday? The most persuasive answer we've heard came from MarketWatch:
"Federal Reserve Chair Kevin Warsh last week suggested that markets should do more of the talking when it comes to guiding investors on where interest rates, inflation and the economy are headed. The $30 trillion Treasury market was taking that message to heart on Monday as yields jumped, despite U.S. oil prices receding below $74 a barrel." (Mortgage rates are closely associated with a 10-year Treasury bond's yield.)
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 | 6.57% | 6.6% | +0.09% | -0.07% |
| 15-Year Fixed | 5.76% | 5.82% | +0.08% | -0.01% |
| 30-Year Fixed FHA | 5.89% | 7.1% | +0.03% | -0.1% |
| 30-Year Fixed VA | 6.04% | 6.19% | +0.02% | -0.08% |
| 30-Year Fixed USDA | 5.94% | 6.11% | +0.01% | -0.12% |
| 30-Year Fixed Jumbo | 6.7% | 6.72% | +0.05% | -0.19% |
| 5/6 Year ARM | 6.21% | 6.28% | +0.03% | +0.13% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.6% | 6.64% | +0.06% | -0.1% |
| 15-Year Fixed | 5.73% | 5.79% | +0.06% | -0.02% |
| 30-Year Fixed FHA | 5.88% | 7.1% | +0.02% | -0.1% |
| 30-Year Fixed VA | 6.03% | 6.12% | +0.02% | -0.09% |
| 5/6 Year ARM | 6.18% | 6.25% | -0.13% | +0.01% |
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. Meanwhile, May's import price index, released Jun. 16, came in worse than markets were expecting.
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.
We should get the minutes of the Jun. 17 meeting roughly three weeks from that date. But events surrounding that 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.
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 Fed’s preferred measure of inflation is forecast to rise to the highest in three years in the May release, reflecting the same spike in energy prices that pushed up the CPI and PPI during the month. Energy prices fell in the first half of June, which should lower PCE inflation considerably in the next report.
"Real GDP growth in the first quarter of 2026 is forecast to be revised down slightly in the Bureau of Economic Analysis’s third estimate, incorporating recent data that pointed to softer consumer spending on services and business fixed investment in equipment."
Comerica also said it expected consumer sentiment to improve this month, reflecting a more cheerful mood as gas prices have fallen back this month.
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. Both are preliminary ("flash") June purchasing managers' indices (PMIs) from S&P Global, one for the manufacturing sector and the other for the services sector.
These tend to be less influential than PMIs from the Institute for Supply Management, and we'll be surprised if they have a big (or pretty much any) impact on mortgage rates today. Still, here are market expectations for each:
- Manufacturing PMI — Markets expect the index to fall back to 54.8 from 55.3 previously
- Services PMI — Markets expect the index to inch up to 51.0 from 50.9 previously
mortgage rates rarely move far.
What's next?
Strap in for Thursday. That's when the Fed's preferred gauge of inflation is due. The personal consumption expenditures (PCE) price index for May will provide the most authoritative guide to price changes that month.
Also, that day, we're due the third and final reading of gross domestic product (GDP) during the first quarter.
