Last Week's Mortgage Rate Recap: Rates increased 👎
Mortgage rates rose last week due to slightly higher inflation data for October and comments from Fed Chair Jerome Powell, suggesting a possible pause in future policy rate cuts.
This Week's Mortgage Rate Forecast: Rates could creep higher 👎
Since mid-September, the mortgage rate outlook has shifted dramatically. Earlier, rates were expected to decrease by the year's end; now, they are likely to stay at current levels or potentially rise further. Be sure to talk with your mortgage pro about why now is a good time to buy or refinance.
What's affecting rates this week:
- The Fed: Expectations that the Fed would continue to cut its policy rate into 2025 are starting to turn around, with markets now preparing for the Fed to hold off on future rate cuts. Although the Fed doesn't set mortgage rates, the underlying economic conditions that stop the Fed from cutting - a strong economy and labor market - would also contribute to higher mortgage rates.
- Inflation: While recent data met expectations, there is concern that the economy may accelerate under President Trump's upcoming administration in 2025, potentially sparking higher inflation. Rising inflation could pressure mortgage rates to move higher.