Portland Mortgage Market Update — June 27, 2025

Shockingly, rates have quietly started an improving trend. Over the past 3 weeks, rates have improved every day except for two days. Now, the improvements have not huge rallies by any means, but in the old saying "rates fall like a feather and rise like a rocket", they are definitely following the feather trend and starting the day in the mid-high 6's. It is a good weekend to buy a house! (or refinance if you bought in the past couple of years!)

What is helping rates? There have been multiple, smaller headlines that have broke recently that bode well for rates:

• Multiple Fed members have come out over the past two weeks saying rates need to be cut sooner rather than later • The Fed voted on loosening regulations on bank holdings this week, which will allow banks to invest more in Treasury Yields thereby helping rates improve • Fed chief Jerome Powell publicly questioned the accuracy of the data being provided by the BLS. For a Fed that has repeatedly stated their decisions are "data-dependent" this may signal a pivot coming where the Fed can cut rates despite what the labor/inflation reports state because they don't trust the results of the report • President Trump seems to be getting more aggressive in his push to replace Powell with someone who will cut rates sooner • Tariffs are now being viewed as "short term" by the market • Trade talks with China seem productive and ongoing, helping calm the markets

Today's PCE report, however, did not help the trend. The Fed's preferred measure of inflation rained all over the parade with marginally weaker numbers. It showed the core rate increasing about .2% and headline inflation rose .1% in May. While these numbers aren't terrible per se, the market is looking to future inflation reports which will be replacing last year's favorable numbers with undoubtedly higher reads, particularly since those months will have been impacted by recent tariffs.