Mortgage rates headed higher by most measures this week after President Trump’s tariff plans sparked fresh inflation fears and led to widespread market volatility.
Average 30-year mortgage rates were 6.92% on Thursday, according to Mortgage News Daily, up 29 basis points from a week earlier. Zillow has them at 6.84%, even after Trump paused tariffs on most countries.
Last week’s tariff announcement shattered several weeks of relative stability for mortgage rates. Rates initially fell, following Treasury yields lower, as investors feared a potential recession.
But what looked like a potential bright spot amid a broad stock market sell-off was short-lived. Ten-year Treasury yields, which closely track mortgage rates, swung wildly, then began marching higher this week amid concerns that the tariffs could usher in stagflation and hamper long-term foreign demand for US bonds.
“The economic situation is rapidly evolving,” Kara Ng, senior economist for Zillow Home Loans, said in a statement. “It’s hard to predict the direction of mortgage rates with any conviction.”
Trump said he was watching the bond market before he announced 90-day relief from higher tariffs for most countries on Wednesday.
“The bond market right now is beautiful,” he said Wednesday. “I saw last night where people were getting a little queasy.”
Ten-year Treasury yields fell somewhat after the higher tariffs were paused, but they remain elevated. They’re about 4.34% now, up from around 4.16% before “Liberation Day.”
Illustrating just how volatile rates were this week, Freddie Mac’s weekly mortgage rate survey, which runs through Wednesday, was an outlier, pinning the average 30-year mortgage rate at 6.62%, down slightly from 6.64% a week earlier. Fifteen-year mortgage rates remained flat at 5.82%.
Tim Stafford, a mortgage broker at Edge Home Finance, said that on a normal bad day for mortgage rates, he might receive two intraday updates from lenders notifying him that their rates were moving higher. On Monday, one large company sent him three.
He’s telling buyers who are comfortable with their monthly mortgage payments to lock in their rates despite the uncertainty. One recent client didn’t take this advice on Friday when rates were falling, only to call back on Monday during the upswing.
“I think in the long term, rates are going to come down,” Stafford said. “But you just don’t know where they’re going to be right now, so if it works for you now, I would lock.”
Mortgage applications jumped last week, helped by buyers and refinancers who managed to take advantage of the brief dip in rates. Applications to purchase a home rose 9% from a week earlier, according to the Mortgage Bankers Association, while refinancing applications surged 35%.