The average 30-year fixed rate mortgage is 6.33% today, an increase of 0.01% since yesterday. The 15-year fixed mortgage rate stands at 5.44%, the same as one day ago. The 30-year FHA mortgage now averages 5.6%, having dropped by 0.05. Meanwhile, the 30-year jumbo mortgage rate is 6.72%, reflecting a decrease of 0.02%.
The bigger picture
In a normal month, investors often shrug off the ADP employment report. Sometimes, they seem to regard it as a bellwether for the official jobs report, which typically lands a day or two later. But mostly, they pay it little heed.
Things may be different for today's ADP report. Owing to the government shutdown, which became the longest in history at midnight last night, we didn't get an official jobs report for September, and — absent the government reopening this week — the October one will also be delayed.
So, markets are hungry for employment data, and may fall upon the ADP report like a starving person falls upon a Big Mac®.
Actually, ADP isn't the only current source of jobs figures. Apollo lists others, including Revelio Labs, Challenger, MacroEdge, LinkUp, Indeed, Paychex, NFIB, San Francisco Fed and state-level jobless claims. But ADP is the most influential after the jobs report itself.
Incidentally, yesterday, Apollo suggested that all these sources " ... show a labor market that is still doing well. Most importantly, there are no signs of a sudden rise in unemployment for cyclical reasons or AI reasons."
That's good news for the economy but bad for mortgage rates. The worse employment is doing, the better the chances of the Federal Reserve cutting general interest rates again on Dec. 10 and of mortgage rates falling today.
Monday's mystery mortgage rate rise
Yesterday, we were left scratching our heads over the driver behind Monday's rise in mortgage rates. Also yesterday, Rob Chrisman, one of the mortgage industry's most distinguished commentators, suggested a possible explanation in his daily e-newsletter.
Chrisman thought the mystery increase might be a result of a glut of bonds. Mortgage rates are largely determined by the yields on a type of bond, the mortgage-backed security (MBS), and MBSs compete with other bonds for purchasers.
Given constant demand, an increase in the supply of bonds will lower their prices. And it's a mathematical inevitability that bond prices move inversely to bond yields. So, lower MBS prices mean higher yields and mortgage rates.
Chrisman wrote, "As Prime Lending’s Andrew Stringer says, 'Let’s identify the supply. Big companies are borrowing money. Tech giants are seeking ways to fund their AI infrastructure. To shore up funding, they often sell Treasuries to buy corporate bonds. More supply equals more selling pressure. There are no buyers in sight, and with investors flying blind due to the data disconnect from the shutdown, confidence is low. Buyers are hesitant to step in amid the momentum shift toward selling. It feels a bit like trying to catch a falling knife. Fewer buyers equals more sellers. Even with the delay in economic reports, the broader market still believes the economy is holding steady. Jobs may be cooling but spending and growth remain solid. This gives the market pause, as the Fed may opt to skip a December rate cut. That means more pressure on bonds … Perhaps our biggest takeaway from the markets is this: cranky traders make bad rate sheet prices.'"
This is a plausible explanation. And it might be that mortgage rates would have fallen further during October had the supply of bonds not increased that month.
But it doesn't explain why mortgage rates rose on Monday but were barely changed yesterday. We're still left scratching our heads and can only repeat our unsatisfactory explanation from Tuesday: Occasionally, markets move for no apparent reason.
Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.33% | 6.36% | +0.01% | -0.03% |
| 15-Year Fixed | 5.44% | 5.49% | +-0% | +0.04% |
| 30-Year Fixed FHA | 5.6% | 6.81% | -0.05% | -0.04% |
| 30-Year Fixed VA | 5.69% | 5.83% | -0.01% | -0.09% |
| 30-Year Fixed USDA | 5.63% | 5.77% | -0.12% | -0.15% |
| 30-Year Fixed Jumbo | 6.72% | 6.74% | -0.02% | +0.02% |
| 5/6 Year ARM | 6.34% | 6.37% | +0% | -0.07% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.4% | 6.43% | +0.03% | -0.03% |
| 15-Year Fixed | 5.41% | 5.46% | +0% | +0.03% |
| 30-Year Fixed FHA | 5.57% | 6.78% | -0.04% | -0.01% |
| 30-Year Fixed VA | 5.72% | 5.86% | -0.03% | -0.08% |
| 5/6 Year ARM | 6.39% | 6.42% | +0.05% | -0.02% |
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 by the government before the shutdown ends. But data compiled by non-governmental sources should be published as normal.
Here's Comerica Bank's preview of this week's economic data:
"Payroll processing company ADP is likely to report private employment rebounded modestly in October after a decline in the prior month. The government’s jobs report would probably have shown a decline due to lower federal government employment, but is delayed by the shutdown. The ISM Manufacturing and Services PMIs probably fell in October amid headwinds from ongoing trade disputes and the government shutdown. Vehicle sales likely fell, too, after EV tax credits expired on Sep 30th. Consumer credit is expected to have risen in September after
holding steady in the prior month. Consumer sentiment and households’ year-ahead and long-term inflation expectations are forecast to hold
steady in their early November releases."
Mortgage rates today
There are three economic reports on today's MarketWatch economic calendar. One is the ADP employment report for the private sector (see above), and two are purchasing managers' indices (PMIs) for the services sector.
PMIs can be useful because they report changes in activity in organizations' purchasing departments. And the busier a business expects to be, the more stuff it will buy to meet demand. The PMI from the Institute for Supply Management (ISM) tends to be more influential than the one from S&P Global.
Here's what markets are expecting from today's reports:
- October's ADP employment report — Markets expect an improvement to 22,000 new jobs, way up from September's -32,000
- October's ISM PMI for the services sector — Markets expect a small improvement to 50.5%, a little higher than September's 50.0%
- October's S&P Global PMI for the services sector — Markets expect a reading of 55.2, unchanged since September
Mortgage rates tend to fall on worse-than-expected figures and rise on better-than-expected ones.
