Mortgage rates remained mostly unchanged on Tuesday, with most lenders offering pricing similar to Monday. This occurred despite a weakening bond market, which is notable because day-to-day mortgage rate changes are primarily driven by movements in the mortgage-backed securities (MBS) and Treasury markets.
On Tuesday, the bond market decline did not occur until after 10:00 a.m. Eastern, following the release of the Job Openings and Labor Turnover Survey (JOLTS) from the Bureau of Labor Statistics. Because most mortgage lenders set daily rate sheets based on market conditions before 10:00 a.m., the later bond weakness was not reflected in published mortgage rates.
If bond markets remain at the weaker levels seen after 10:00 a.m., lenders would typically publish higher rates the following business day.
Upcoming Federal Reserve Announcement
The Federal Reserve will release its next policy statement tomorrow afternoon. The widely anticipated federal funds rate cut—if delivered—is not the same as a mortgage rate cut. Mortgage rates do not move in direct response to changes in the federal funds rate. Historically, mortgage rates have sometimes increased following Fed rate cuts because rate decisions may influence broader market expectations for economic growth, inflation, and long-term yields, which directly affect mortgage pricing.
The key market-moving components of tomorrow's announcement are:
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2:00 p.m. ET: The Summary of Economic Projections (SEP)
This includes the “dot plot,” which shows each Federal Reserve member’s outlook for the future path of the federal funds rate. Markets focus heavily on changes to these projections. -
2:30 p.m. ET: Federal Reserve Chair press conference
Bond markets often react more strongly to the Chair’s comments and explanations than to the policy statement itself.
Bottom Line (All Facts)
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A Fed rate cut does not directly translate into lower mortgage rates.
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Mortgage rates respond to bond market activity, not to the federal funds rate.
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Volatility tomorrow is most likely to come from the Fed’s economic projections and the Chair’s press conference, not from the rate cut itself.
