Mortgage Rates

As much as the mortgage and real estate world wishes for lower interest rates, the Fed is clear that they will not pivot from keeping rates higher until the data shows signs that the economy needs a boost and inflation remains in check. The US Bureau of Labor Statistics‘ Employment Situation Summary is the most important economic release each month. Last week’s report pushed back against the argument that the Fed will pivot anytime soon.

Unemployment Rates

The household survey showed that the unemployment rate held at 4.2% in May and has been between 4.0% and 4.2% since May 2024. In May 2025, certain sectors, such as healthcare and leisure and hospitality, experienced growth while the Federal government continued to shed jobs. However, it was the higher-than-expected payroll component that received the most attention, and the attention was not good for mortgage rates.

Impact of Job Losses

I believe that some of the negative impact of the loss of Federal jobs has not yet been reflected in these numbers, as many Federal workers who lost their jobs are still on administrative leave and, therefore, continue to be on the government payroll. With the various lawsuits working through the courts, the impact of these job losses may take some time to be reflected in this report.

In the meantime, we are still seeing lots of purchases come through our office, so let us know if you would like to look at numbers.