Mortgage Rates Today, November 3, 2025: Rates Taking a Breather?

The bigger picture

Friday brought a modest drop in mortgage rates. According to ICanBuy, the average rate for a 30-year fixed-rate mortgage stood at 6.14% on Tuesday evening, immediately before the Federal Reserve warned markets that another cut in general interest rates next month was not a foregone conclusion.

By Thursday evening, that same rate had risen to 6.31%, but by Friday's close it had recovered a little to 6.28%. That may mean that markets have now adjusted their risk analyses in light of Wednesday's Fed news conference.

That might be the end of the Fed story for now. But it raises the possibility of a bigger rise in mortgage rates next month if the Fed doesn't cut general interest rates on Dec. 10.

That's because the CME FedWatch tool shows that only some investors heeded the Fed's warning. Over the weekend, the tool suggested odds of a 63% chance of a December rate cut, while we interpreted the Fed's message as closer to a 50-50 chance.

Government shutdown

On Wednesday, the current government shutdown will become the longest in history.

Congressional legislators showed signs of closing in on an agreement to reopen the government last Thursday. But, on Friday, The Wall Street Journal suggested a possible setback: "President Trump’s demand that Republican senators bypass Democrats to reopen the federal government risked upsetting delicate negotiations on Capitol Hill, where lawmakers were finally making progress toward a deal to end the monthlong impasse."

This involves taking the so-called nuclear option, which is the end of the Senate filibuster rule. This stops many bills from being enacted without the support of at least 60 of the 100 senators.

Generally, senators in whichever party is in power dislike the idea of losing the filibuster for a short-term gain, as they fear what will happen when the opposing party gains a majority.

Purely from the point of view of mortgage rates, the shutdown hasn't yet been a big issue. It has inflicted some measure of pain on the economy, allowing those rates to drift lower.

How much pain? Last week, the Congressional Budget Office wrote: "The agency estimates that real gross domestic product (GDP), which has been adjusted to remove the effects of inflation, will be lower in the fourth quarter of 2025 than it would have been in the absence of a shutdown. Depending on its length, the government shutdown will reduce annualized real GDP growth in that quarter by 1.0 to 2.0 percentage points. After the shutdown, real GDP will be temporarily higher than it would have been otherwise. Although most of the decline in real GDP will be recovered eventually, CBO estimates that between $7 billion and $14 billion (in 2025 dollars) will not be."

Even if the economic pain is limited, the shutdown has been inflicting much more hurt on individual Americans, especially civil servants whose paychecks have been delayed and employees of government contractors who have suffered from the same or have been laid off. Forty-two million recipients of SNAP benefits were also about to be hurt, although a court has ordered the government to keep making those payments, reports CBS News.

The big danger for mortgage rates is the flood of official economic data that will be released in the days and weeks following a reopening.

If the numbers show the economy doing better than investors were assuming, mortgage rates might rise. If they show it doing worse than their assumptions, those rates might fall. Either way, the cumulative effect of so much data in such a short time might make markets' reactions sharp.

Tariffs

Any reaction in markets to the reduction in tariffs arising from the U.S.-China summit last Thursday was muted. As we said on Friday, there was some skepticism about how robust and effective the framework agreement reached would prove.

That doesn't mean changes in tariffs will no longer affect mortgage rates. Big announcements could still send them higher or lower.

In particular, this week, the Supreme Court is due to hear arguments that most tariffs implemented since February are unlawful, reports AP News. The court has so far been unwilling to restrain the executive's powers, and many think it's unlikely to start now.

However, a shock ruling that scraps swathes of recent tariffs would likely push mortgage rates higher. Having said that, there would be bad consequences for the economy as well as good, so the impact of such a ruling is not wholly clear.

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 employment, inflation, tariffs and deficit funding are especially influential at the moment.

The shutdown means almost no official economic data will be published until the government reopens. So far, there has been only one exception: For legal reasons, the delayed September consumer price index was published on Oct. 24. Nothing else is expected to be released before the shutdown ends.

Mortgage rates today

There are two economic reports on today's MarketWatch economic calendar. They're both final October purchasing managers' indices (PMIs) for the manufacturing sector.

PMIs can provide helpful insights into the economic outlook because they show activity in organizations' purchasing departments. Ones from the Institute for Supply Management (ISM) tend to be more influential than those published by S&P Global. They're the publishers of today's reports.

Unfortunately, MarketWatch had not updated its calendar with market expectations for these two reports by the time we had to post this.

Mortgage rates tend to rise on better-than-expected figures and fall on worse-than-expected ones.

The government shutdown will delay all the reports due to be released tomorrow.