Mortgage rate movements stayed muted as investors await the culmination of June's Federal Open Market Committee meeting later on Wednesday.
Rates declined for the third consecutive week, but remained in that tight 6.8% range, the Freddie Mac Primary Mortgage Market survey reported.
The survey was released a day early because of the Juneteenth holiday.
What happened with mortgage rates this week
"Mortgage rates moved lower, with the average 30-year fixed rate reaching a four-week low," Sam Khater, Freddie Mac chief economist, said in a press release. "More available inventory to choose from, coupled with this week's decline in mortgage rates, could be the spark to get potential homebuyers off the sidelines."
The 30-year fixed-rate mortgage averaged 6.81% as of June 18,
The 15-year FRM had a smaller decline, just 1 basis point to 5.96%.
How the Fed meeting will impact mortgage rates
Mortgage rates are in part priced off of the 10-year Treasury. This metric can and has moved in reaction to what investors think about what the FOMC does or doesn't do.
"At 2.8% for May, core [Consumer Price Index] inflation has stopped declining, leaving many to speculate whether the Fed should lower rates or keep them the same," Geno Paluso, CEO of Sagent Lending Technologies said in a Wednesday morning statement. "Lower rates would lead to loan payoffs and possible borrower hardships for mortgage servicers to manage, and continued higher rates could help servicer retention for the balance of 2025."
Long-term rates have seen little change so far this year, resulting in a "more upward sloping yield curve," said Moody's Ratings Senior Vice President Allen Tischler in a comment.
"From an asset risk perspective, higher long-term rates can limit weaker borrowers' ability to refinance their debt and constrains collateral values, particularly for commercial real estate," Tischler continued.
The markets
What other mortgage rate trackers show
The 10-year Treasury yield has been bouncing up and down the last few weeks. While it was at 4.37% as of 11 a.m., June 18, and up just 1 basis point from where it closed on June 12, the past week marked another period where the 10-year yield spiked higher during the interim, reaching 4.45% on June 16.
Zillow's rate tracker for the 30-year FRM was at 6.91% on Wednesday morning, flat from Tuesday and 2 basis points lower than its previous week average of 6.93%.
At the same time, Lender Price data posted on the National Mortgage News website put the 30-year FRM at 6.915%. On June 12, this tracker reported the 30-year at 6.922%, a change of less than 1 basis point.Earlier on Wednesday, the Mortgage Bankers Association released its Weekly Application Survey for the period ending June 30. It found the
What is driving mortgage rates today
Too many "wild cards" are in the markets for the FOMC to make a change right now, argues Melissa Cohn, regional vice president of William Raveis Mortgage.
The latest bond roller coaster was driven by higher oil prices pushing them up earlier this week, but countered by the weaker retail sales data released on Tuesday; the latter is a sign consumers are concerned, Cohn said.
As for the future, "anyone who's going to make a prediction with any sort of certainty is a fool," Cohn said. "We are fully loaded with uncertainty" from the world geopolitical standoffs in the Middle East and Ukraine versus Russia.
As a result, too many "little wildfires" are impacting the markets. "Which one are you going to put out first?" Cohn asked, answering her own question by saying this will affect any FOMC decision and keep mortgage rates more or less where they currently are, at least for now.
