August new home sales were much higher than expected

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Published Date 9/24/2025

This morning the 10 year note began 2 bps higher at 4.13%, MBS prices down 6 bps from yesterday after increasing 9 bps yesterday.

Last week MBA reported mortgage applications +0.6% after increasing 29.7% the week before. Purchase apps +0.3% from +2.9% and re-finance apps +0.8% from 24.4% jump the prior week. Prior to last week applications were the second highest going back the Covid, March 2020. Refinance volume increased further last week and is now 80% higher than four weeks ago, accounting for more than 60% of all application activity.

Powell talked yesterday saying the outlooks for the labor market and inflation face risks, calling it a "challenging situation”. Recent comments from Powell have tilted from inflation being the main key to the softening employment outlook. Inflation, according to the Fed will stay high for almost two years before achieving the elusive 2.0% target.

Tomorrow weekly jobless claims hold as much sway as Friday’s PCE inflation data. Claims expected at 238K up from 231K the prior week that showed claims declined 33K from the week before that. Year/year core PCE on Friday 2.9% unchanged from July.

At 9:30 am ET the DJIA opened +84, NASDAQ +72, S&P +11. 10 year note 4.13% +2 bps. FNMA 5.5 30 year coupon at 9:30 am -6 bps from yesterday’s close and -1 bp from 9:30 am yesterday.

At 10 am ET August new home sales, expected at 649K from 652K, sales increased to 800K.

This afternoon Treasury will auction $70B of 5 year notes; yesterday’s 2 year note auction met with soft demand.

Before the FOMC meeting last week the wide consensus in markets was the Fed would cut rates by 75 bps this year, 25 bps last week and 25 more coming in October and 25 more in December. Since the meeting last week, the optimism has softened with comments from Powell and a few Fed officials reminding the Fed will do what the incoming data implies.

In the absence of any unexpected news today markets will have another quiet session.

Source: TBWS

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NEXA Mortgage, LLC (NMLS #1660690) is an equal Housing Lender - 3100 W Ray Rd 201, Suite 209, Chandler, AZ 85226 (www.nmlsconsumeraccess.org)

Scott Moon

Home Loan Advisor

NMLS: 1492315

NEXA Mortgage

3100 W Ray Rd Suite 201 Office 209, Chandler AZ 85226

Company NMLS: #1660690

Office: 202-352-5625

Cell: 202-352-5625

Email: smoon@nexamortgage.com

Web: http://www.scottmoon.us