Mortgage rates dip slightly, staying near 2025 lows ahead of CPI report

Mortgage rates have edged slightly lower over the past few days, hovering near year-to-date lows as markets weigh the ongoing government shutdown and await key inflation data later this week.

“Rates have been fairly flat the last week and a half; the shutdown really hasn’t — at least as far as the mortgage market is concerned — had many dramatic effects,” said Adam Neft, senior vice president of sales and loan officer at Ultimate Mortgage Brokers. “The longer it goes, the more economic downturn we will unfortunately see, and it’s going to have a ripple effect.”

On Tuesday, HousingWire’s Mortgage Rates Center, which tracks locked loans, showed that 30-year conforming loan locks averaged 6.35% — three basis points (bps) lower than a week ago and closer to the 6.32% lowest level of 2025. Jumbo 30-year rates fell 4 bps compared to the prior week to 6.22%, while FHA 30-year loans were down from 6.2% to 6.18%.

The government shutdown, which reached its 21st day on Tuesday and some predict could last until Thanksgiving, has primarily impacted federal employees and borrowers relying on the National Flood Insurance Program or FHA-endorsed reverse mortgages.

Market dynamics 

The shutdown has also postponed the release of key inflation data. The government plans to publish the Consumer Price Index (CPI) for September on Friday, just a week before the Federal Reserve’s next meeting on interest rates. Nearly 97% of market watchers expect the Fed to cut rates by 25 basis points, bringing the target range to 3.75%–4%.

Bank of America analysts said Monday in a report that they expect headline CPI to rise 0.3% month over month, keeping the year-over-year rate near 3%, little changed from August. Tariffs will likely continue driving goods price inflation in the coming quarters, while services inflation may moderate as housing and non-housing costs ease slightly. 

“If our forecast is correct, we do not think the report will be a game changer for the Fed,” the analysts wrote. “We expect a 25bp cut in October.”

Logan Mohtashami, lead analyst at HousingWire, wrote that mortgage rates are near their 2025 lows, with the 10-year Treasury yield at 4% — marking “the third time this year we have attempted to break through that key level in the bond market.”

“Many who claimed higher rates were inevitable due to inflation, tariffs, federal debt, deficits and Treasury supply have overlooked a fundamental principle: 65% to 75% of where the 10-year yield and the 30-year mortgage rate can go is still determined by Fed policy,” Mohtashami added.

Boots on the ground

Mortgage Bankers Association (MBA) president and CEO Bob Broeksmit said in a statement that with rates below 6.5% and housing inventory rising, “MBA expects affordability conditions to improve through the rest of 2025.”

Meanwhile, at the street level, LOs are using seller credits to help buyers lower their rates.

“A lot of sellers are not in a desperate state, but homes that are sitting longer are open for seller credits,” Neft said. “I’ve had plenty of loans closed in the last three to six months with rates in the 4s or 5s on permanent fixed-rates with the seller credit. This is going to be a lot more advantageous than a $10,000 price reduction in most cases.”