Four things that could impact rates this week

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Published Date 7/28/2025

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 moving sideways today. The MBS market improved by +11 bps last week. This was not enough to decrease mortgage rates or fees. The market experienced high volatility last week.

This week's Rate Forecast: Neutral

Four Things: These are the FOUR areas that have the greatest ability to impact rates this week. 1) The Fed, 2) Tariffs, 3) Inflation and 4) Jobs.

1) The Fed: We actually hear from two Central Banks on Wednesday with the Bank of Canada and our own Fed. No one expects any real changes from our FOMC but the market will be keenly focused on the number of dissenting votes and the setup for a cut (or not) in September.

2) Tariffs: After last week's announced deal with Japan, we start the week off with a deal with the European Union and talks in Sweden with China where they have already announced another 90 Day pause to keep negotiations flowing. The August 1st deadline for all other countries (this Friday) is fast approaching and we are looking for more trade announcements, particularly from India.

3) Inflation: We get the "official" measure of inflation, PCE on Thursday just one day after the FOMC meeting. Will the impact of Tariffs finally show up in the data? Or is it being absorbed to an extent that its not a big factor?

4) Jobs: What is the real jobs picture? We see weakness in the regional and private sector data sets but see stability in the government released data. This Friday we will get the BLS' jobs data with Non Farm Payrolls, Unemployment Rate, Average Hourly Earnings and more. Plus throughout the week we get a ton of job and wage related data such as JOLTS, ADP, Challenger Job Cuts, ISMs, Employment Cost Index and more.

Bonus round: We have a lot more than just jobs and inflation this week with Consumer Confidence and the preliminary GDP which is expected to rebound from -0.5% to +2.5% which is a huge move.

This week's Potential Rate Volatility: High

This morning markets saw some rocky trading that has left us near where we started. Volatility has started at moderate levels but will increase later this week.

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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American Home Lending USA, LLC - NMLS ID: 71983. To verify licensing, visit NMLS Consumer Access (www.nmlsconsumeraccess.org). Equal Housing Lender.

Jeff Beck

President

NMLS: 19488

American Home Lending USA, LLC

240 S Buchanan St, Edwardsville IL 62025

Company NMLS: 71983

Office: 618-310-0091

Cell: 618-806-2281

Email: jbeck@ahlusa1.com

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