Mortgage Rates Today, Thursday, June 25: Moving Higher

Mortgage rates moved in opposite directions this week as markets absorbed a sharp inflation increase and the Federal Reserve's first meeting under Chair Kevin Warsh. The central bank's shorter official statement and a dot plot hinting at a possible rate hike added to the uncertainty.

The average interest rate on a 30-year, fixed-rate mortgage jumped to 6.35% APR on Thursday, according to rates provided to NerdWallet by Zillow ^[1]. The following day, the rate ticked down to 6.26% APR ^[2]. The moves came as the latest Personal Consumption Expenditures Price Index, the Federal Reserve's preferred inflation measure, showed prices rose at an annual rate of 4.1% in May, the highest level in three years ^[1][2]. High inflation typically puts upward pressure on mortgage rates ^[2].

The inflation report arrived just after the Fed's June meeting, the first chaired by Kevin Warsh. The central bank's official statement was notably shorter than usual and dropped the forward guidance that had been a regular feature ^[1]. Warsh also declined to participate in the dot plot, which shows policymakers' expectations for the federal funds rate, leaving 18 projections instead of the usual 19 ^[1].

The dot plot that was released implied a possible rate hike by the end of this year, with the median expectation for the funds rate rising just above its current level ^[1]. The Fed's June Summary of Economic Projections indicated policymakers expect the federal funds rate to remain elevated for the rest of 2026 ^[2]. A Fed rate cut seems even less likely now that the PCE report shows inflation accelerating at its highest level since April 2023 ^[2].

For homeowners considering refinancing, it might make sense if today's rates are at least 0.5 to 0.75 of a percentage point lower than their current rate ^[1][2].