Week Ahead – The calm for mortgage rates could be over! 📅 😱

It's happening, everybody stay calm!

Oct 12, 2025

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WEEK AHEAD 📅
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It has been a relatively uneventful government shutdown for bond markets.

Monday I will take a deeper look at how mortgage rate prices, bond spreads, and longer-term trends unfolded in my Mortgage Rate Data Deluge.

However, the recent calm could end in the days ahead.

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Although government econ data has been delayed due to the shutdown, the Labor Department has called back select staff to prepare the Consumer Price Index.

Inflation reports are a major market mover and part of the “Big 3”:

Inflation (CPI/PCE)

The Fed (FOMC/Minutes)

Employment (NFP/ADP)

Scheduled to be released next Thursday, Oct 24, CPI is guaranteed to reignite volatility.

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President Trump has been extremely vocal about his desire for more rate cuts from the Fed.

However, the U.S. Central Bank is supposed to act independently, focusing purely on its dual mandate of price stability (inflation) and maximum employment.

Recent inflation reports haven’t provided sufficient top-cover for The Fed to silence the political pressure by cutting more aggressively.

Yet, the urgency from the current administration to have the CPI report published might suggest inflation is cooler than expected, favoring additional rate cuts.

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The FOMC doesn’t meet again until Oct 28-29, but bond markets could react negatively to a CPI report that implies another rate cut is on the horizon.

The last 4 rate cuts were not well received, resulting in lower bond prices, which increases the PRICE of mortgage rates.

Still on hold, and just as important, is the Non-Farm Payroll data.

If the government is re-opened by November, there is potential that last month’s NFP employment report is released on the heels of the next Fed rate decision.

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Let’s bring our attention back to the short week ahead, while keeping The Fed in focus.

There is a speech from Chairman Jerome Powell, the Fed Biege Book, and a plethora of appearances throughout the week from other Fed Regional Presidents.

It promises to be a wakeup call of a week, so everybody try to stay calm … STAY CALM!