With the FOMC meeting six days away, brokers shouldn't expect relief anytime soon
Mortgage rates moved higher again this week, with the 30-year fixed-rate mortgage climbing to 6.52%, according to Freddie Mac's weekly Primary Mortgage Market Survey released Thursday. The increase comes after back-to-back hot inflation reports, likely giving the Federal Reserve no reason to consider cutting rates at next week's meeting.
The 30-year fixed-rate mortgage averaged 6.52%, up from 6.48% last week and down from 6.84% a year ago, according to Freddie Mac. The 15-year fixed-rate mortgage averaged 5.84%, up from 5.79% last week and down from 5.97% a year ago.
Sam Khater, Freddie Mac's chief economist, said buyer activity is holding up better than the rate environment might suggest.
"The 30-year fixed-rate mortgage averaged 6.52% this week," Khater said. "Stronger employment momentum has helped existing home sales reach a five-month high. Importantly, we're seeing homebuyers look past the short-term rate fluctuations and actively enter the market, signaling renewed confidence in homeownership opportunities."
Rates and the Fed
Tuesday's existing home sales report backed up Khater's read, showing transactions climbing 3.2% in May to their highest level since December 2025. Buyers have been more stubborn than expected, though the path to meaningfully lower rates keeps getting narrower.
Thursday's Consumer Price Index report showed inflation rising to 4.2% on a 12-month basis in May, up from 3.8% in April and the highest reading since April 2023. Energy prices accounted for more than 60% of the monthly gain. The Federal Open Market Committee (FOMC) meets June 16-17, and CME FedWatch showed just a 3.8% chance of a rate cut heading into the week. Nothing in Thursday's data changes that.
Rates have now risen in back-to-back weeks after briefly dipping to 6.37% in early April following a temporary ceasefire in Iran. Since then, they have crept steadily higher as inflation keeps coming in hot and the prospect of Fed rate relief has faded.
Selma Hepp, chief economist at Cotality, said that brokers need to be honest with clients about where rates are headed rather than selling a story the data no longer supports.
"Maybe we've seen the best of rates for this year, and so we'll have to wait for it to come around again," Hepp said. "You've got to be honest with people. You can't pretend something is happening when it's not."
Her advice for brokers was to stop talking about rate predictions and start talking about rate ranges.
"Instead of providing an expectation of lower rates, provide an expectation of range," Hepp said. "Tell them, 'If we're in this range and we lock in at any point within this range, can you as a consumer afford this?' Instead of just saying, 'Hey, you can refi down the road.' If you say, 'Hey, there is a possibility of moments of opportunity, let's get ready for it.' That's the honest conversation."
What brokers are dealing with
Thursday's reading puts rates roughly where they were in late May, when Freddie Mac reported 6.51%. Inventory remains tight, and the buyers closing deals right now are doing so in spite of borrowing costs, not because of any relief on them.
Sam Williamson, senior economist at First American, said last week that the May jobs report, the last one before the FOMC meeting, gave the Fed less cover to signal anything dovish.
"Stronger payroll growth, positive revisions, steady wages, and broader hiring give policymakers less reason to signal labor-market support, especially with renewed inflation pressure from higher oil and energy prices still in view," Williamson said. "The result could be a shift away from a dovish bias and toward a more neutral stance."
Next week's FOMC meeting is unlikely to result in a rate cut, but it might produce a clearer sense of where Kevin Warsh wants to take policy, and whether the second half of 2026 looks any different from the first.
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