WTMS Blog Today = What’s up in Mortgage Today (PM) – 10/29/2025

Mortgage rates hit their lowest levels in over a year, driving massive refinance activity ahead of this afternoon’s Federal Reserve decision. The 30-year mortgage rate dropped to 6.30% according to MBA data, spurring a 111% annual jump in refinance demand. Total mortgage application volume surged 7.1% for the week, with both purchase and refinance applications climbing significantly.

The Fed is widely expected to cut rates by 25 basis points at 2:00 PM ET today. While the rate cut is fully priced in by markets, Chair Powell’s press conference could create volatility in either direction. Consumer confidence declined for the third straight month, reinforcing expectations for continued Fed easing through December.

MBS prices opened modestly weaker this morning, with the 30-year UMBS 5.0 coupon down 4 basis points at 100.07. The 10-year Treasury yield climbed 17 basis points to 3.993% as traders position for the Fed announcement. Despite the morning weakness, rates remain at their most attractive levels since late 2023.

Fannie Mae reported its 31st consecutive quarterly profit this morning, posting $3.9 billion in net income. Housing data showed mixed signals with Case-Shiller home prices rising 1.6% annually versus 1.9% forecast, while the FHFA index beat expectations at 0.4% monthly growth.

Locking vs Floating

Current rates represent the lowest levels in over a year, but today’s Fed decision could push them in either direction.

Markets have fully priced in a 25-basis point cut, meaning any hawkish commentary from Powell could cause rates to rise quickly. For loans closing within 30 days, locking may be prudent given the uncertainty surrounding Fed guidance and economic data disruptions from the government shutdown.

Today’s Events

– Case Shiller Home Prices-20 y/y (Aug): 1.6% vs 1.9% forecast
– FHFA Home Price Index m/m (Aug): 0.4% vs 0.1% forecast
– Consumer Confidence (Oct): 94.6 vs 93.2 forecast
– 2:00 PM: FOMC Rate Decision

Bond Pricing

UMBS 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 100.07 | -0.04 |
| 5.5 | 101.39 | -0.02 |
| 6.0 | 102.49 | 0.02 |

GNMA 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 100.06 | -0.01 |
| 5.5 | 101.04 | 0.01 |
| 6.0 | 101.88 | 0 |

Treasuries
| Term | Yield | Price | Intra-Day Yield Change |
| 2 yr | 3.5 | 100 | 0.01 |
| 3 yr | 3.508 | 99.977 | 0.012 |
| 5 yr | 3.621 | 100.018 | 0.013 |
| 7 yr | 3.794 | 100.496 | 0.019 |
| 10 yr | 3.993 | 102.099 | 0.017 |
| 30 yr | 4.564 | 103.031 | 0.018 |