Three things that could impact rates this week

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Published Date 5/5/2025

Today's Mortgage Rate Summary

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up.

Rates Currently Trending: Neutral

Mortgage rates are under pressure today. The MBS market worsened by -32 bps last week. This may have been enough to increase mortgage rates or fees. The market experienced high volatility last week.

This week's Rate Forecast: Neutral

Three Things: These are the three areas that have the greatest ability to impact rates. 1) The Fed, 2) Central Banks and 3) Domestic News.

1) The Fed: On Wednesday we will get the FOMC's Interest Rate Decision and Policy Statement. There will NOT be an Economic Projections at this meeting. There is not expected to be any interest rate change at this meeting but we may see some commentary/groundwork being laid for a cut in July. We will get a live presser with Fed Chair Powell afterwards. Then we will get a barrage of Feds on Friday.

2) Central Banks: The FOMC is not the only game in town as we will also hear from the Bank of England which is expected to cut rates by 25BPS.

3) Domestic News: The biggest economic release of the week is Monday's ISM Services PMI. Consumer Credit will also get some attention.

Treasury Auction: Here is this week's auction schedule:

05/05 3 year note

05/06 10 year note

05/08 30 year bond

This week's Potential Rate Volatility: High

This morning markets started under some pressure. Volatility has started at moderate levels but will likely increase on Wednesday.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

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All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

Jeff Beck - NMLS ID: 19488. To verify licensing, visit NMLS Consumer Access (www.nmlsconsumeraccess.org). 

Jeff Beck

Loan Expert

NMLS: 19488

American Home Lending USA

240 S Buchanan St, Edwardsville IL 62025

Company NMLS: 2239

Office: 618-310-0091

Cell: 618-806-2281

Email: jbeck@ahlusa1.com

Web: https://www.americanhomelendingusa.com/