Good Thursday morning from your Hometown Lender. Here is today’s market analysis.

Yesterday, mortgage bonds lost ground, pushing rates higher after stronger-than-expected jobs data splashed cold water on a Fed rate cut before June.

The good news is that bonds were up quite a bit on the day before the data, and rate sheets were only slightly worse, rather than seeing rates jump. It was a missed opportunity for sure, though, because a weak report could have helped push rates lower.

Rate sheets today are better than yesterday as mortgage bonds start the day with some small gains. Tomorrow’s CPI report is taking on additional importance with the stronger jobs report.

With the better pricing today, it is tough to float into tomorrow’s data.

From a higher viewpoint:

Daily Update — v1.0 (Thursday, February 12, 2026)

Market Analysis – Quick Snapshot

10-year Treasury: roughly 4.13%–4.16% (4.13% cited in this week’s mortgage-rate coverage; latest FRED DGS10 print shows 4.16%).
Fed funds rate: 3.50%–3.75%, unchanged at the Jan 28 FOMC, with two dissents.
Inflation: latest official CPI is Dec 2025 at 2.7% YoY headline and 2.6% YoY core; Jan CPI is due Friday, Feb 13, 8:30 a.m. ET.
Labor pulse: Jan payrolls +130k, unemployment 4.3%; weekly initial claims 227k.
Mortgage rates (national ballpark): Freddie weekly survey 30Y 6.09% / 15Y 5.44%; MBA contract rate 30Y conforming 6.21%.

1) Market Analysis – What Hit This Morning (CPI)

No CPI release this morning — the market is effectively in “answer-key tomorrow” mode ahead of Friday’s CPI print.
Today’s hard data was more labor/housing flavored: claims still relatively contained, while existing-home activity came in soft.

Narrative you can use:
“Today wasn’t an inflation verdict day — it was a positioning day. Labor is still resilient, housing is still sensitive, and tomorrow’s CPI is the tiebreaker.”

2) Fed Watch

The Fed is still in pause-and-observe mode at 3.50%–3.75%.
After stronger January jobs data, markets trimmed near-term cut confidence; Reuters notes June hold odds rose (while at least one cut by mid-year is still in play).
Translation: policy is likely data-dependent meeting by meeting, with inflation prints carrying extra weight right now.

3) Market Analysis – Where Mortgage Rates Actually Are

Freddie’s weekly average is still near the low-6s: 30Y 6.09%, 15Y 5.44%.
MBA’s contract survey runs a touch higher at 6.21% for conforming 30Y, with refi activity cooling week-over-week and purchase activity rising.
Rate sheets are still being steered by the same trio: 10Y yield, inflation expectations, and Fed path.

4) Market Analysis – Housing Market Check

Existing-home sales dropped 8.4% MoM to 3.91M SAAR in January (lowest since Dec 2023).
Median existing-home price: $396,800 (+0.9% YoY).
Inventory: 1.22M homes (slightly lower MoM, higher YoY).

Read-through: affordability has improved from 2025 peaks, but the market still needs either more inventory relief or another leg down in financing costs to unlock stronger volume.

5) Political Backdrop & Fed Independence

Treasury reported a $95B January deficit, with customs-duty revenue up sharply and YTD deficit still large.
CBO projections and Reuters market commentary continue to frame a “bigger issuance / higher-for-longer term premium” debate.
Working theory (not certainty): heavier fiscal supply plus policy uncertainty can keep longer-end yields sticky even if the Fed eventually eases short rates.

6) Market Analysis – What This All Means for Rates Going Forward (3-Scenario Grid)

Scenario	What would trigger it	Mortgage-rate direction (working theory)
Base case: grind sideways	CPI cools slowly, labor stays decent	30Y mortgage rates hover around low-6s
Bull case: better pricing	Clear disinflation + softer labor trend	Faster move toward upper-5s/low-6s
Bear case: re-tightening pressure	Hot CPI + resilient jobs + fiscal/term-premium pressure	Move back toward mid-6s

Grounded by current Fed stance, payroll/claims trend, CPI timing, and fiscal/yield commentary.

7) Practical Takeaways

Agents: set expectations that buyers can negotiate more on terms than they could a year ago, but monthly payment math still rules the room.
Buyers: don’t anchor to internet “national average” alone — program, credit, points, and lock structure still create meaningful spread in outcomes.
Sellers: pricing discipline matters more than ever in a market where demand is present but selective.

8) Market Analysis – Lock vs Float

Close ≤ 21 days: lock bias is still the disciplined move into CPI-event risk.
22–45 days: balanced approach (partial lock / float-down strategy if available).
45+ days: selective float can make sense, but with guardrails around CPI/Fed dates.

(Mortgage strategy should always match borrower risk tolerance and payment goals.)

Stay safe and make today great!