This past week, interest rates improved during a relatively quiet news period. However, that calm ends this week as we face a wave of market-moving events.

“Into this world, we’re thrown. Like a dog without a bone. An actor out on loan. Riders on the storm”. Riders on the Storm by The Doors

A Silent Lead-Up to the Fed Meeting

In the 12 days leading up to the Federal Reserve’s meeting, Fed members are prohibited from discussing monetary policy, keeping things subdued as we approach the big event.

• Will the Fed cut rates? Unlikely at this time. However, the Fed’s comments on the economy and recent positive inflation data could pave the way for a September rate cut.
• Will Jerome Powell step down or be fired? Highly improbable. Long-term rates, like mortgages, may find short-term stability as fears of aggressive rate cuts sparking inflation fade.

July 30th: A Pivotal Day

In addition to the Fed’s Monetary Policy Statement on July 30, we’ll see the Quarterly Refunding Announcement (QRA). The QRA outlines the Treasury’s bond sales for the upcoming quarter.

Speculation suggests Treasury Secretary Scott Bessent may announce a significant reduction in long-term debt sales, such as 10-year notes and 30-year bonds. If true, this could help lower yields by boosting bond prices. The opposite could occur if long-term debt sales increase.

Managing our debt and deficits is important and the bond market is watching. If the markets question our ability to trim our deficits and pay down our debt, it could lead to higher for longer long-term rates.

30-Year Mortgage Rates

The 30-year fixed rate mortgage averaged 6.74% as of July 24, 2025, down slightly from the previous week when it averaged 6.75%.

4.50%

The 10-year Treasury note yield closely tracks 30-year mortgage rates. When yields rise, mortgage rates follow; when yields fall, rates decline. This past week, rates hit resistance at 4.50% before easing slightly. The key range to watch is 4.20% to 4.50%. A breakout above or below this range will signal the next major move for mortgage rates.

Bottom Line: Rates have been stuck in a wide sideways range for the past nine months. This week’s major announcements could either prolong this trend or trigger a breakout.

Looking Ahead

Next week is critical for the mortgage and housing markets. Beyond the Fed Meeting and QRA, key reports include:

• The Fed’s preferred inflation measure, Core PCE
• The July Jobs Report
• JOLTS (jobs available, hires and quits)
• GDP

Mortgage Market Guide Candlestick Chart

The chart clearly illustrates how rates remain confined within a wide range, with a ceiling capping rate improvements and a floor limiting rate increases. At some point, bonds will break out of this range, providing a clear signal for mortgage and housing professionals, as well as those looking to purchase or refinance a home.

Chart: Fannie Mae 30-Year 5.5% Coupon (Friday, July 25, 2025)