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This morning started off fairly quiet in the bond market, which plays a major role in determining mortgage rates. Bonds were trading near the same levels as yesterday, meaning no real movement in rates early on.

Shortly after the market opened, bonds began to slip a bit which can put upward pressure on mortgage rates. But that changed once the stock market opened at 9:30 AM Eastern. Stocks moved lower, and when the stock market struggles, investors often shift money into bonds for safety. That increased demand helped stop the earlier weakness in bonds.

Then at 10:00 AM Eastern, a new economic report measuring Consumer Sentiment showed that consumers are feeling less confident about the economy. When confidence drops, investors typically expect slower economic activity ahead. That often pushes more money into bonds, which raises bond prices and helps push mortgage rates down or at least prevents them from rising.

Bottom line for homebuyers:
Today’s economic data didn’t create a big move in rates, but weaker consumer confidence helped stabilize the bond market and keep mortgage rates steady instead of rising.

Because the government shutdown has paused many of the usual economic reports, investors are turning to alternative data sources to understand what’s happening in the job market and the broader economy. One of the newest and most-watched sources is a company called Revelio Labs.

Revelio gathers data from multiple private sources and uses modeling to estimate job growth, similar to the government’s monthly jobs report but with less month-to-month volatility. While their numbers aren’t a perfect match to official government data, the trend lines tend to move in the same direction.

This morning, their latest report showed a slowdown in job creation, meaning fewer new jobs were added in the latest period.

Why does that matter for mortgage rates?

• Investors generally prefer bonds when economic data shows slowing growth.
• Higher demand for bonds pushes bond prices up, and when that happens, yields…which influence mortgage rates fall.

So even though this data isn’t from the usual government source, the weaker job trend gave investors a reason to buy bonds this morning, helping mortgage rates improve slightly.

This morning brought two key pieces of economic data that tend to move the markets the ADP employment report and the ISM Services Index. Together, they give investors an early look at how the job market and service sector — the largest part of the U.S. economy are performing.

Both reports came in stronger than expected, signaling continued economic resilience. That kind of data often leads investors to move money out of bonds and into the stock market, which pushes bond prices down and causes mortgage rates to edge higher.

There were, however, a few softer points that helped limit the market reaction. The ISM report’s employment component, a key measure of hiring, remained below 50, indicating that job growth in the service sector is slowing slightly. That suggests the economy isn’t overheating, which helped keep the sell-off in bonds relatively modest.

Overall, today’s data didn’t offer the kind of slowdown investors were hoping for to support lower mortgage rates.

This morning, we saw a more traditional market pattern play out when the stock market drops, bond prices tend to rise. That shift can be good news for mortgage rates, since bond prices and rates move in opposite directions.

Overnight, heavy selling in stocks gave bonds a small boost, pushing yields slightly lower. While this relationship used to be the norm, it hasn’t been consistent lately. Since late spring, both stocks and bonds have often moved in the same direction rising together as investors balanced hopes for rate cuts with concerns about the broader economy.

Today’s activity feels like a brief return to the “old normal.” But that effect may be short-lived. If stocks regain strength, bond prices could lose some ground, which would likely put mild upward pressure on mortgage rates.

Mortgage-related bonds opened the day a bit weaker. Overnight selling pushed yields higher early on one of the triggers being a large corporate bond offering from Alphabet, which tends to draw investor demand away from Treasuries (and indirectly affects mortgage-backed securities). That pushed 10-year yields up about 4 basis points at the open.

Later, the ISM Manufacturing Index came in somewhat weaker than expected, offering a hint of support for bonds (because weaker data can lead investors back into bonds). But the rally didn’t hold, likely because the corporate issuance weighed more than the data positive, for now.

What this means for homebuyers:
Rates may remain slightly elevated in the short term as the market digests these mixed signals. If weaker economic data continues, it could help push rates a little lower. If issuance and stronger financial conditions keep popping up, rates could stay flat or drift higher.

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📅 The Week Ahead (Housing & Mortgage-Related Data Only)

Date	Report	Why it matters for mortgage rates
Tuesday	Mortgage Applications (Weekly by MBA)	Higher application volumes show buyers are active → bond investors may move toward stocks → bond prices down → rates up. Lower volumes suggest fewer buyers → bond prices up → rates down.
Wednesday	Building Permits & Housing Starts	If construction jumps, it signals housing strength → bond investors anticipate inflation or growth → bond prices down → rates up. If starts slide, demand may be cooling → bond prices up → rates may ease.
Thursday	Existing Home Sales Report	Strong sales = high demand in housing → looks like growth and possibly pressure → bond prices down → rates up. Weaker sales = slowing housing market → bond prices may rise → rates could come down.
Friday	National Housing Survey / Builder Sentiment (NAHB Index)	Confidence among builders shows future housing activity. A surge -> economy may be strong → rates up. A drop -> potential softness ahead -> rates down.

 

After the Fed’s announcement yesterday, the bond market pulled back slightly, not because of any major surprise, but because expectations had simply gotten a bit ahead of reality.

Over the past few weeks, investors had grown increasingly confident that the Federal Reserve would cut rates three times in 2025, with another cut already locked in for December. But during his press conference, Fed Chair Jerome Powell signaled a bit more caution, suggesting that while another cut this year is possible, it’s not guaranteed.

That message caused a modest uptick in bond yields, which means mortgage rates ticked slightly higher — as the market adjusted to a more balanced outlook. This morning’s continued weakness in bonds is just mild follow-through from that adjustment and not a sign of a major shift.

For now, markets will be watching upcoming non-government economic data, such as private-sector job reports and housing indicators, to see whether the economy shows signs of slowing or holding steady.

• If the data shows the economy cooling, bond prices could rise, and mortgage rates may ease lower.
• If the data remains strong, bond prices could fall, and mortgage rates might stay higher for a bit longer.

In short, the market is taking a breather — and waiting for the next round of economic clues before making its next move.