![Mortgage Investors Group in [Dynamic1]](../assets/images/mortgage-investors-group.svg)
Market Comment
Mortgage bond prices finished the week slightly lower which put a little up pressure on rates. Equities were positive most of the week until the sharp selloff Friday morning. MBS prices traded within a very narrow range with a slight negative bias. The government data continued to be delayed due to the shutdown. Consumer sentiment was 55 vs 54.2. The Fed minutes indicated most participants anticipate gradual rate cuts in 2026, though uncertainty persists due to potential upside risks to inflation and downside risks to employment, with some emphasizing data-dependent adjustments to monetary policy. Mortgage interest rates finished the week worse by approximately 1/8 of a discount point.
LOOKING AHEAD
| Economic Indicator | Release Date & Time | Consensus Estimate | Analysis |
| Consumer Price Index | Wednesday, Oct. 15, 8:30 am, et | Up 0.3%, Core up 0.3% | Important. A measure of inflation at the consumer level. Weaker figures may lead to lower rates. |
| Fed “Beige Book” | Wednesday, Oct. 15, 2:00 pm, et | None | Important. This Fed report details current economic conditions across the US. Signs of weakness may lead to lower rates. |
| Producer Price Index | Thursday, Oct. 16, 8:30 am, et | Up 0.3%, Core up 0.2% | Important. An indication of inflationary pressures at the producer level. Lower figures may lead to lower rates. |
| Retail Sales | Thursday, Oct. 16, 8:30 am, et | Up 0.4% | Important. A measure of consumer demand. A smaller than expected increase may lead to lower mortgage rates. |
| Philadelphia Fed Survey | Thursday, Oct. 16, 10:00 am, et | 32 | Moderately important. A survey of business conditions in the Northeast. Weakness may lead to lower rates. |
| NAHB Housing Index | Thursday, Oct. 16, 10:00 am, et | 83 | Moderately Important. A measure of single-family housing. Weakness may lead to lower mortgage rates. |
| Housing Starts | Thursday, Oct. 16, 10:00 am, et | 30 | Important. A measure of housing sector strength. Weakness may lead to lower rates. |
| Industrial Production | Friday, Oct. 17, 9:15 am, et | Up 0.2% | Important. A measure of manufacturing sector strength. A lower than expected increase may lead to lower rates. |
| Capacity Utilization | Friday, Oct. 17, 9:15 am, et | 77.3% | Important. A figure above 85% is viewed as inflationary. Weaker figure may lead to lower rates. |
Trade Tensions
Trade war fears reignited late Friday morning as the U.S. Administration noted concerns about a breakdown in U.S. and China relations. China announced a tightening of export controls on rare earth elements which received a strong rebuke from the U.S. President. He countered with a social media post that stated, “One of the Policies that we are calculating at this moment is a massive increase of Tariffs on Chinese products coming into the United States of America.”
U.S. stocks sold off sharply in response to the statement and there was significant flight to safety buying of U.S. Treasuries. Mortgage-backed securities did not see the same demand as Treasuries but held steady in the short-term. The broader impact on U.S. housing is uncertain. Tariffs on Chinese imports impact every facet of U.S. housing as the industry relies heavily on products and materials from China.
