Portland Mortgage Market Update — October 31, 2025

The Fed SLASHED interest rates this week! The fed met this week for its penultimate meeting of the year and delivered a 25 basis point cut on their interest rate, just as the market predicted. There were only two members who dissented to the idea of this rate cut, one person who didn't want to cut at all and another who wanted a more aggressive 50bps cut. Either way, the market breathed a sigh of relief and looked forward to the post meeting comments.

Then Jerome Powell SPOOKED the markets! Going into this meeting, the market was betting an almost 100% chance of a cut this week and around a 97% chance of a December rate cut. In his post meeting remarks, Powell went out of his way to address the likelihood of a December rate cut saying it was "not a foregone conclusion. Far from it". It was the "far from it" that did the real damage, and now the market is a somewhere around 60% chance of a December rate cut. This happened on the same week that Amazon, UPS and Target all announced huge layoffs either incoming or already in process. But the Fed has been resolute in their data-dependency, so it makes sense that they don't want to commit to any future changes to their policy when they are effectively flying blind during the government shutdown damming the flow of data that would usually stream from the BLS.

Will next week's ADP report be a TRICK OR TREAT? As I mentioned above, the Fed usually bases decisions off of BLS reports for employment data, but we won't get that next week so we will look to the ADP employment report. Preliminary data released this week hints at a 55,000 job growth for the private sector over the past month, compared to the -32,000 lost posted in September. Obviously, the worse the labor market looks the better it is for rates