Market Update

The Fed minutes from the June 17 meeting showed policymakers are nearly split down the middle on the path for interest rates. Eight members favored no rate cuts this year, one favored a single cut, and nine projected one rate hike.

Most Fed members also expect inflation to continue easing as oil prices decline and the impact of tariffs diminishes.

Translation: The inflationary “mess” is expected to continue cleaning itself up.

Existing home sales fell 2.4% in June to a seasonally adjusted annual rate of 4.09 million, missing expectations for a 0.7% increase. The Northeast was the only region to post a gain in sales.

Initial jobless claims remained stable at 215,000, while continuing claims increased by 8,000 to 1.814 million, indicating the labor market is gradually softening but remains resilient.

The ongoing U.S.-Iran conflict continues to create volatility in both the 10-year and 30-year Treasury markets, resulting in significant swings in mortgage rates.

My Take:
The overall picture remains constructive. Cooling inflation, lower oil prices, and a stable labor market are all positive signals for the bond market. While no one can predict exactly where mortgage rates are headed, staying informed and watching the data, not the headlines, can create opportunities. As always, timing matters.

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