Last week was WILD and if Trump and his administration stick to their word, this week will be no difference. While everyone knew Trump had tariffs on his agenda, the stock market was still completely blindsided by Trump's Liberation Day announcement. It turns out no where is safe from tariffs (not even the islands solely populated by penguins and seals). Trump swears this time is different and the tariffs will not be postponed again - adding more fuel to the fire.

President Trump and his top advisers dug in over the weekend, with the president suggesting that equity markets may need to "take medicine" and posting that the new tariffs are "already in effect, and a beautiful thing to behold."

Labor reporting came in mixed which, when paired with the tariffs, only adds to the confusion on how the economy will perform in the future.

Stocks fell rapidly and look to continue their losses today. How far will they fall and what does that mean for mortgage rates?

The average rate on a 30-year fixed rate conventional loan did fall to 6.48%  - down from 6.63% the week before, which wasn't as big of a move as I expected given the market turmoil!

Plenty of readers are starting to think about refinancing. Remember, no one can predict how far rates will continue to drop. Please read the rate cut section below to read my advice.

Sign up for our weekly Friday rate texts to stay in the know on where rates are week by week! It's a must for anyone planning to buy or refinance in 2025! 

JOBS JOBS JOBS

Before the Trump tariffs and the "impending trade war" turned the market upside down,  it was supposed to be a somewhat tame week with labor reporting.

Job openings reported cooler than expected numbers as the number of positions decreased to 7.57 million (worse than the 7.66 million openings expected). Also worth noting is that demand for workers is now back to pre-pandemic levels, a sign that the labor market has normalized. I expect the job openings number to keep falling if the Trump tariffs don't resolve soon.

The March Jobs Report also reported with mixed results. Nonfarm payrolls in March increased 228,000 for the month, up from the revised 117,000 in February and better than the Dow Jones estimate for 140,000. That's a HUGE beat, and while these numbers are often not 100% accurate, it's an unexpected sign for the labor market. On the other hand, the unemployment rate did inch back up to 4.2%, higher than the 4.1% forecast as the labor force participation rate also increased.

The reporting was largely overshadowed by the Liberation Day tariffs that caused the stock market to fall fast and hard. Over the weekend, there were louder cries for rate cuts to ease the worries of business leaders on the state of the US economy as a result of the tariffs.

So...where are mortgage rates heading?

I've talked at length about how much Trump wants to see rates come down (and how much Powell doesn't want to cave to Trump's demand). Well now it appears that Powell might not have as much power to hold rates steady.
 
JPMorgan (among others) are now looking to the Fed to do an emergency rate cut, meaning they want to see the Fed cut rates before the next meeting - something we haven't seen happen since the Pandemic.
 
Additionally, we are seeing the likelihood of a rate cut on May 7th nearly double and, even crazier, the market now predicts that we'll see 5 rate cuts by the end of 2025 (up from just 2 predicted last week)! But always remember, the Fed Funds Rate does not have a perfect correlation with mortgage rates.

Mortgage rates may go down, but they also may not fall at all. In fact, as of 8AM CT on Monday April 8th, mortgage rates are higher than they were last week - despite the stock market dip. I'm not Nostradamus, but I don't even think that even he would be foolish enough to predict what will happen with rates. 

The markets are in full blown panic and it's easy to get caught up in that panic. PLEASE DON'T! Remember that the stock market can recover just as quickly as it falls (like in 2020 and 2022) and the stock market is NOT the economy! Most importantly - please do not read the comments on social media posts and believe them to be from credible sources! If you have questions, contact your financial advisor (or trusted friend or family member or even me), not an anonymous account.

If you are interested in refinancing, please reach out to me so I can help you understand you potential savings and navigate the situation.

On top of all the craziness this week from tariffs, CPI comes out this Thursday! If inflation continues to fall, it's one less concern for Powell to be able to cut rates. Make sure to follow us on Instagram for immediate reactions to all  news