Mortgage Market in Review

June 8, 2026

Market Comment

Mortgage bond prices finished the week sharply lower which put significant upward pressure on rates. Rates bounced up and down throughout the week in volatile trading and ended on a sour note. Energy inflation and strong job growth pressured rates higher. Oil prices rose approximately 6% for the week despite a mid-week pullback. The data was mixed with generally solid employment figures. ADP employment was 122K vs 117K. JOLTS Jobs openings were 7.618M vs 6.88M. Factory orders rose 4.8% vs 4.6%. Weekly jobless claims were 225K vs 213K. Productivity rose 0.3% vs 0.5%. Unemployment was 4.3% as expected. Mortgage interest rates finished the week worse by approximately 3/8 of a discount point.

Looking Ahead

Economic
Indicator		Release
Date & Time		Consensus
Estimate
Analysis
Weekly ADP EmploymentTuesday, June 9, 8:30 am, et38KImportant. An indication of employment. Weakness may bring lower rates.
Trade DataTuesday, June 9, 8:30 am, et$55.5B deficitImportant. Affects the value of the dollar. A falling deficit may strengthen the dollar and lead to lower rates.
Existing Home SalesTuesday, June 9, 10:00 am, et4.05MLow importance. An indication of mortgage credit demand. Significant weakness may lead to lower rates.
Consumer Price IndexWednesday, June 10, 8:30 am, etUp 0.5%, Core up 0.3%Important. A measure of inflation at the consumer level. Lower than expected increases may lead to lower rates.
Producer Price IndexThursday, June 11, 8:30 am, etUp 0.8%, Core up 0.4%Important. An indication of inflationary pressures at the producer level. Lower figures may lead to lower rates.
Weekly Jobless ClaimsThursday, June 11, 8:30 am, et225KImportant. An indication of employment. Higher claims may result in lower rates.
U of Michigan Consumer SentimentFriday, June 12, 10:00 am, et46Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.

Payrolls Surge

Payrolls data from the U.S. Bureau of Labor Statistics showed a surge in May which resulted in mortgage interest rate increases last Friday. The release noted, “Total nonfarm payroll employment increased by 172,000 in May” which was significantly higher than the expected 85,000 increase. “Job gains occurred in leisure and hospitality, local government, and health care. Leisure and hospitality added 70,000 jobs in May, well above the average monthly gain of 14,000 over the prior 12 months. Over the month, food services and drinking places added 48,000 jobs. Employment in local government rose by 55,000, largely reflecting a gain in local government, excluding education (+44,000).”

The data reinforced the consensus that the Fed will hold steady with any rate adjustments for now. However, a potential rate hike the latter portion of this year is now back on the table. Some prediction markets note the odds of a Fed hike in 2026 surged to approximately 52–68%, driven by stronger-than-expected job growth and persistent inflation. The payrolls data also pushed any 2026 rate cut odds to single digits.

Floating in this environment is very risky as we saw last week. A cautious approach to float/lock decisions is prudent amid market uncertainty.