Issue 131 - Hello and Happy Tuesday.

This week feels like a tug of war between two big storylines. On one side, the threat of a government shutdown could rattle markets and create short-term volatility. On the other, all eyes are on the September jobs data due Friday, which could set the tone for where rates head next.

Together, these factors are pulling investors in opposite directions and keeping mortgage rates sensitive to every headline.

What to Watch:

• 🏛️ Government shutdown headlines could flare up midweek as funding deadlines approach.

• 👷 Jobs data ramps up starting with ADP’s private payroll report on Wednesday, jobless claims on Thursday, and the big September Jobs Report on Friday.

Personal Note:
There will be no newsletter next week. Jamie and I are taking the boys to Sutter’s Mill in the Sacramento area to learn about the Gold Rush. Pictures and stories on the 14th for sure!

Oktoberfest was a success, as always. Thank you to those who came and donated to the Toys for Tots!

TLDR (Too Long Didn’t Read) Summary

• ↔️ RATES - Rates have been stable after a push upward following the Fed rate cut.

• 📊 TECHNICALS - Inflation holding steady.

INTEREST RATES
Rates 📢 September 30th, 2025

Rate data as of morning of publication. Unless noted otherwise, all scenarios are assuming 30 Year-Fixed mortgage, Purchase or R/T Refinance. No origination points charged, 780 FICO score, and 20% down payment. Provided for consumer education only and does not serve as a binding offer to extend lending. Payment period, interest rate, APR, and other terms subject to income, asset, and credit profile qualification. Provided courtesy of GTG Financial, Inc. NMLS 1595076. Equal housing opportunity. www.nmlsconsumeraccess.org

💡 Why This Matters

Mortgage rates ticked higher after the Fed’s September 17th cut (as expected) and have since settled into a holding pattern. Right now, markets are waiting on this week’s jobs data and any developments around a potential government shutdown. Both could shift momentum:

• 📊 Jobs Report Friday – A weaker labor market could spark a rally in bonds and push mortgage rates lower. A stronger report does the opposite.

• 🏛️ Government Shutdown Risk – If data releases are delayed, uncertainty can create volatility in mortgage pricing.

• 🔄 Fed’s Next Moves – Fed officials remain divided on how quickly to ease policy. Their tone in upcoming speeches will keep influencing expectations.

👉 Realtor Insight: Buyers should not expect big rate drops in the near term. We are in a sideways market where data surprises, like this Friday’s jobs report, will be the catalyst for the next move.

TECHNICALS

Fed’s Inflation Gauge Holds Steady

• The Fed’s preferred inflation measure (Core PCE) rose 0.2% in August, keeping the annual rate at 2.9%.

• Overall inflation ticked up to 2.7%, slightly higher than July.

• The Fed is balancing two pressures: inflation still above target and signs of a softening job market.

• The next big moment? September Jobs Report on October 3, which could heavily influence the Fed’s October 29 decision.

👉 Realtor Insight: Stable inflation keeps the Fed cautious. Until labor market data clearly shifts, don’t expect big swings in mortgage rates.

👷 Jobless Claims Decline Again

• First-time jobless claims dropped to 218,000, marking two straight weeks of improvement.

• Continuing claims stayed high at 1.926 million, showing it’s still harder for people to find new work.

👉 Realtor Insight: The labor market is cooling but not collapsing. Buyers may gain confidence if layoffs slow, but affordability still depends on mortgage rates.

📈 GDP Beats Expectations

• Q2 GDP grew 3.8%, a sharp rebound from the 0.6% drop in Q1.

• Stronger consumer spending and fewer imports boosted the number.

• First half of 2025 is averaging 1.6% growth.

👉 Realtor Insight: A healthier economy supports housing demand – but continued growth may also keep the Fed cautious on rate cuts.