Mortgage Rates Edge Higher
During an extremely light week for economic data, mortgage markets were relatively quiet. Comments from Fed officials and news about tariffs caused little reaction. Mortgage rates ended last week slightly higher.
Jobless Claims Dip Slightly
The Department of Labor releases the total number of new claims for unemployment insurance each week. The latest reading was 227,000, down from 233,000 last week and slightly lower than the consensus forecast. Bigger picture, this was far below the inflated figures seen during the early months of the pandemic, and in line with the levels which were typical during 2019. Weekly jobless claims are important because they are one of the timeliest indicators of labor market trends.
Hiring Slows, Layoffs Stay Low
While the headline figure for jobless claims was consistent with a solid labor market experiencing relatively few layoffs, another major component of the report was a bit more troubling. The reading for continuing jobless claims, which measures the total number of people collecting unemployment insurance each week, rose to the highest level since November 2021. This suggests that it is difficult for people who are out of work to find jobs. In other words, it appears that companies continue to be reluctant to lay off their current employees, but they are slowing their pace of hiring new workers.
Fed Split on Rate Cuts
The detailed minutes from the June 18 Fed meeting revealed diverging opinions among officials about the outlook for future monetary policy. They generally were in agreement that it likely would be appropriate to reduce the federal funds rate later in the year, but the anticipated timing and magnitude of the cuts varied widely. Officials were split about balancing potential increases in inflation due to tariffs and signs of weakness in the labor market. Most investors currently expect that the next Fed rate cut will take place in September.
Mortgage Rates for the week of 7-14-2025