Market Analysis 6.16.25-Rates Are Flat

Good Monday AM from your Hometown Lender,

Rates are flat on the day as there is not much on the calendar.

The war in the middle east tragically rages on but markets have for the moment, shrugged off concerns of how it will impact oil prices. Volatility risk on the day is low (I guess that is a relative term), only a 20-yr Treasury auction this afternoon at 1pm ET (which really shouldn’t get much reaction in mortgage bonds).

The data gets a little more important tomorrow with Retail Sales, Capacity Utilization, Industrial production, etc.

However, all eyes this week are on Wednesday’s Fed meeting, which will be a bit more interesting given the weaker current inflation and employment data balanced against future inflation concerns from tariffs and war. Wednesday will be volatile, but we do have a little window Wednesday AM between when markets open and when the Fed announcement comes out.

Unless retail sales numbers come out tomorrow well outside expectations (which is possible as markets are expecting as dismal -.5%), it is likely ok to float loans up to the Fed announcement. The US markets will be closed on Thursday in observance of Juneteenth so expect greater volatility late Wednesday afternoon as markets pare positions. I’d like to see some love after the Fed meeting and if the Fed comes across a bit dovish (especially at Powell’s press conference) we could see rates improve substantially.