Good Monday morning from your Hometown Lender,

Market Analysis – The government is in particle shutdown mode. The Senate approved the spending bill, but the House doesn’t meet until today. Hopefully, they use better judgment this time around and approve the bill. Rates continue to hold steady.

Bonds are not getting much of any boost from the selloff in precious metals, which would have been nice. Rates have now given back almost all the improvements gained from the announcement about the GSEs buying mortgage bonds. Precious metals, which had a rough week, are stable for the moment, but I would expect further volatility. Bitcoin is below 80k.. This is all because the dollar is strengthening.

Market Analysis – from a higher view:

Market Analysis – Quick Snapshot — Mon, Feb 2, 2026

10-year Treasury: 4.228% (still living in a tight range).
MBS (UMBS 30yr, last posted): 5.5 = 101-16 (+0-02) | 5.0 = 100-03 (+0-03) | 4.5 = 98-03 (+0-03).
Fed funds rate: 3.50%–3.75% (held on Jan 28).
Mortgage rates (national ballpark):
MND daily index (last update Fri 1/30): 30-yr fixed 6.16% | 15-yr 5.75% | 7/6 SOFR ARM 5.61%.
Freddie Mac weekly avg (1/29): 30-yr 6.10% | 15-yr 5.49%.
Today’s big macro print: ISM Manufacturing PMI jumped to 52.6 (back into expansion).

1) What Hit This Morning (CPI)

No CPI today—the mover was ISM Manufacturing (Jan).

PMI: 52.6 (up from 47.9, first expansion in ~a year).
New orders: 57.1 (big rebound, demand looks alive).
Prices paid: 59.0 (inflation pressure still lurking in the supply chain shadows).
Employment: 48.1 (still contracting—manufacturing is saying “we’ll take the growth, but we’re not hiring a marching band”).

Narrative you can use:

“Today’s data says the economy still has traction—especially in orders—so bonds aren’t getting a clean ‘rates can fall fast’ signal. That usually keeps mortgage pricing choppy and range-bound.”

2) Fed Watch

The Fed held at 3.50%–3.75% and emphasized “data-dependent” patience.
Next FOMC: March 17–18 (SEP meeting).
Powell’s presser leaned into the idea that tariff-related inflation effects should fade over time—important because “one-time” price shocks don’t always mean “higher-for-longer policy.”

3) Market Analysis – Where Mortgage Rates Actually Are

Daily reality (what borrowers feel): MND’s index has 30-yr fixed at 6.16% (last updated Fri 1/30).
Weekly headline average: Freddie’s 30-yr at 6.10% (1/29).

Translation: We’re still in a low-6s world, and the “real” swing factor is MBS volatility + points/credits (not the Fed’s last meeting headline).

4) Housing Market Check

Existing-home sales (Dec): 4.35M SAAR (+5.1% MoM).
Inventory: 1.18M (about 3.3 months’ supply).
Pending sales (Dec): index 71.8 (down ~9.3% MoM—pipeline got cautious).

Takeaway: closings improved, but future demand is still rate/payment sensitive.

5) Market Analysis – Political Backdrop & Fed Independence

This is the week where monetary policy got a new character in the story:

President Trump said he will nominate Kevin Warsh to succeed Powell as Fed Chair when Powell’s term ends in May (subject to Senate confirmation).
Markets are already trading the perception that Warsh is more hawkish / more focused on fighting inflation, which can raise volatility (and volatility feeds into mortgage rate sheets).

Think of it as a “headline tax” on bonds: even if the data is normal, the political premium can make rate moves messier.

6) Market Analysis – What This All Means for Rates Going Forward

Base case (most likely): Range + chop

Stronger activity data (like ISM) + still-elevated prices components = mortgage rates stay ~6.0–6.3 near-term.

Better-for-rates case: Disinflation wins cleanly

If inflation prints cooperate and growth cools, you can see brief “high-5s” windows—but they may be fleeting.

Worse-for-rates case: Sticky inflation + volatility premium

If prices pressure hangs around and politics adds volatility, you drift back toward mid-6s.

7) Practical Takeaways

Buyers: win with structure (seller credits, temporary buydowns, smart product choice), not “waiting for the perfect headline.”
Sellers: if you’re priced right, you’ll still get action—buyers are just pickier and more payment-focused.
Agents: your unfair advantage is certainty: clean docs + fast underwriting + strong communication.