The average 30-year fixed rate mortgage was 6.38% yesterday, an increase of 0.01% since the day before. The 15-year fixed mortgage rate stood at 5.46%, the same as one the day before. The 30-year FHA mortgage averaged 5.67% yesterday, having risen by 0.03. Meanwhile, the 30-year jumbo mortgage rate was 6.77%, reflecting an increase of 0.03%.
The bigger picture
Mortgage rates today
Mortgage rates were effectively unchanged yesterday, with no market-moving headlines and only one very minor economic report. There's a single, similarly unimportant report today, but we can't guarantee how the headlines will turn out.
In particular, stock markets are in rapid retreat. Overnight, The Guardian reported, "Global markets are racking up their fourth day of losses in a row, as concerns over technology valuations are worrying investors. Asia-Pacific stocks have dipped to a one-month low today, amid signs that the enthusiasm that has driven stocks higher in recent months is fading, with shares, risky currencies and crypto assets all sliding."
Yesterday afternoon, a Wall Street Journal headline read, "Market Rout Intensifies, Sweeping Up Everything From Tech to Crypto to Gold." The article summary said, "S&P 500, Nasdaq slip below their 50-day moving average for first time in 138 trading days, and Dow industrials cap worst three-day drop since April."
There is a growing awareness in stock markets of the possibility of an artificial intelligence (AI) bubble. Investors have poured trillions of dollars into AI ventures, at least partly driven by a fear of missing out (FOMO).
But few of the companies they've backed are yet to show a profit. And there's an increasing realization that many probably never will.
Even if AI reaches its full potential, there will be plenty of companies that fall by the wayside, just as there were in the dot-com bubble. In other words, there will be winners and losers.
All this could change tomorrow when Nvidia releases its latest quarterly earnings. Providing it publishes its usual spectacularly good figures, stock markets could calm again.
Also tomorrow, the Federal Reserve is due to publish important minutes (see next section), and, if they raise the odds of a December cut to general interest rates, that, too, could calm stock markets.
Purely from the point of view of mortgage rates, a stock market rout could be a good thing. Investors often use the money from the sale of stocks to buy relatively safe bonds, including mortgage-backed securities, the yields on which largely determine mortgage rates.
The extra demand drives up bond prices, which invariably means lower yields — and mortgage rates. Every cloud ...
The Fed
This week's scheduled event most likely to affect mortgage rates is tomorrow's release of minutes by the Federal Reserve. These cover the last meeting, three weeks ago on Oct. 29, of the Federal Open Market Committee (FOMC), which is the Fed body that sets general interest rates.
Investors will pore over these minutes to try to glean new insights into the split between hawks and doves among committee members. Hawks are worried about inflation running too warm, and wish to hold general interest rates steady to slow price rises. Doves want to cut those rates on Dec. 10 because they fear that the labor market is in trouble. A rate cut then might stimulate economic growth and boost employment.
If doves appear to have had the upper hand at that Oct. 29 meeting, mortgage rates might fall because markets might conclude that a rate cut on Dec. 10 is more likely than they currently think. However, if the hawks dominated the meeting, mortgage rates might rise.
Fed Chair Jerome Powell made clear at his post-meeting press conference on Oct. 29 that "A further reduction in the policy rate at the
December meeting is not a foregone conclusion — far from it." And various Fed officials have reinforced the point since.
But, until very recently, markets shrugged off those warnings. A month ago, markets were putting the chances of a December cut at 93.7%, according to the CME FedWatch tool. A week ago, the odds had fallen to 62.4%. Last night, they stood at 42.9%.
These drops in the odds of a cut have likely contributed to recent rises in mortgage rates. However, those rates might fall again if the chances improve or if the Fed springs a surprise by announcing an unexpected cut at its December meeting.
Thursday's jobs report
It's hard to predict how markets and mortgage rates will react to the jobs report (aka the employment situation report), due on Thursday morning.
On the one hand, the report, delayed from Sep. 5, covers August, which now feels like ancient history. On the other hand, it brings the first official data in nearly a month (the consumer price index was exceptionally published on Oct. 24), and its rarity value alone should draw plenty of attention.
Markets will be hoping that it shows fewer-than-expected new jobs created in August. A truly terrible report might force the Fed's hand and make a December rate cut more likely.
Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.38% | 6.41% | +0.01% | +0.11% |
| 15-Year Fixed | 5.46% | 5.51% | +0% | +0.13% |
| 30-Year Fixed FHA | 5.67% | 6.88% | +0.03% | +0.1% |
| 30-Year Fixed VA | 5.71% | 5.85% | +0.01% | +0% |
| 30-Year Fixed USDA | 5.77% | 5.91% | +0.02% | +0.04% |
| 30-Year Fixed Jumbo | 6.77% | 6.79% | +0.03% | +0.15% |
| 5/6 Year ARM | 6.19% | 6.23% | +0.11% | +0.01% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.44% | 6.46% | +0% | +0.15% |
| 15-Year Fixed | 5.45% | 5.49% | +0.03% | +0.15% |
| 30-Year Fixed FHA | 5.63% | 6.84% | +0.03% | +0.11% |
| 30-Year Fixed VA | 5.74% | 5.88% | +0.01% | +0.01% |
| 5/6 Year ARM | 6.23% | 6.26% | +0.08% | +0.04% |
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.
With a government reopening underway, we can anticipate the publication of official reports to slowly return to normal. Had the shutdown been brief, we could have expected a flood of official economic reports on reopening. But the length of the hiatus means that it is no longer the case. Data won't have been collected — let alone compiled and prepared for publication — during the shutdown. So, delayed or even canceled reports are inevitable.
This week
That means that this week's calendar is far from certain. September's jobs report should be released on Thursday, but that might be the only official data all week.
Comerica Bank's economics team published on Monday this preview of the week:
"Financial markets will closely scrutinize the minutes of the FOMC’s October meeting this week amidst growing divisions among policymakers
about their best path forward. Currently, financial markets place the odds of the Fed cutting rates again in December at around 50-50, as
several of the FOMC’s voting members have signaled their preference for pausing the cutting cycle. Given stresses in short-term funding markets in recent weeks, financial markets are also likely to closely parse assessments of financial conditions from the Fed staff economists and policymakers, looking for signs of when the Fed will restart growth of the balance sheet.
"Besides the minutes, the largest event is the long-delayed September jobs report, which the BLS [Bureau of Labor Statistics] will release on
November 20. ... Other scheduled (but likely delayed) releases include industrial production and capacity utilization, which probably rose modestly in October. Building permits and housing starts likely registered an annualized rate of around 1.350 million last month. Homebuilder sentiment is expected to have shown a small uptick. The decline in mortgage rates last month probably boosted sales of existing homes. The flash estimates of PMI [purchasing manager index] surveys from S&P Global are forecast down slightly in November, but the University of Michigan’s consumer survey likely improved as the government shutdown ended."
Mortgage rates today
There is only one economic report on today's MarketWatch economic calendar. It's the November home builder confidence index.
Mortgage rates rarely react to this particular report.
