Another nice week ahead of next week's FED meeting

Happy Friday from Local Mortgage!

Well, we made it! We officially made it back into the 5’s for the first time in 2025. After a few decent inflation reports, rates crept down just a little further this week, putting us firmly in the 5’s. We will finish the week at 5.875% for our best 30-year-old fixed conventional scenario.

Thursday’s CPI report was generally favorable for rates as the Core CPI number matched expectations. The core component of CPI, which excludes food and energy, rose 0.3%, which was right on target. Inflation data from the Producers Price Index, released earlier in the week was lower than expected, giving us two decent inflation reports ahead of next week’s FED meeting.

Next week’s meeting will take place on Wednesday, where a 25-basis point cut is expected. There is growing optimism amongst investors that a 50-basis point cut could be on the table.

I personally think that mortgage rates could go either way with a 25-basis point as it’s possible that we could see some pullback from the run down we have experienced over the last couple of weeks. But if we get a 50-basis point cut, I think the rally will certainly continue and push rates down further. We will see next week.

Hope everyone has a great weekend.  Thank you for reading.