Mortgage Rates Today, Apr. 17, 2025: Fed Chair Says Rate Cuts Delayed

The bigger picture

Let's start with the good news. So far this week, mortgage rates have moved lower each day, with Monday and Tuesday bringing appreciable falls.

And bond markets (one of which largely determines mortgage rates) close at 2:30 p.m. (EST) this afternoon for the Easter weekend and won't reopen until Monday morning. So, assuming nothing spooks investors this morning, there's a good chance those rates will end this week on a positive note.

Less-good news

Inevitably, that's not the end of the story. To start with, this good week has only repaired a chunk of the damage wreaked on mortgage rates last week.

And, while markets seem calmer now than they were, there is still electric tension surrounding Wall Street. It's not so much that investors are waiting for the other shoe to drop. It's more that they fear an avalanche of falling footwear over the coming weeks and months.

Investors place a very high value on certainty — or, at least, a measure of predictability. And that's sorely lacking now as the trade war emerges in a tightly packed series of jolting developments.

Expect maximum volatility — with alternating soaring and tumbling stock indices, bond yields and mortgage rates — until investors feel they have a grasp of what is happening now and what will probably happen next.

The Fed

Yesterday, we trailed a speech that Federal Reserve Chair Jerome Powell was due to deliver that afternoon. His words are enormously influential on Wall Street and around the world, and his message almost certainly affected mortgage rates.

Here are the most relevant extracts from his speech:

"Despite heightened uncertainty and downside risks, the U.S. economy is still in a solid position. The labor market is at or near maximum
employment. Inflation has come down a great deal but is running a bit above our 2 percent objective.

"Tariffs are highly likely to generate at least a temporary rise in inflation. The inflationary effects could also be more persistent. Avoiding that outcome will depend on the size of the effects, on how long it takes for them to pass through fully to prices, and, ultimately,
on keeping longer-term inflation expectations well anchored.

"Our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level
does not become an ongoing inflation problem. As we act to meet that obligation, we will balance our maximum-employment and price-stability mandates, keeping in mind that, without price stability, we cannot achieve the long periods of strong labor market conditions that benefit all Americans. We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension. If that were to occur, we would consider how far the economy is from each goal, and the potentially different time horizons over which those respective gaps would be anticipated to close."

Powell wound up by saying that the Fed was in no hurry to cut general interest rates further. "For the time being, we are well-positioned to wait for greater clarity before considering any adjustments to our policy stance."

This wait-and-see approach isn't helpful for mortgage rates. Once investors come to believe that the Fed will cut general interest rates, mortgage rates tend to fall in anticipation of the move. Powell seems to imply that there's currently nothing to anticipate.

Not all top Fed officials agree with Powell. See the "Fed civil war?" heading in our Tuesday column for more on that.

Coming up

Although economic reports are usually the main drivers of changes to mortgage rates, they're not the only ones. The general mood in markets and economically consequential news can also affect those rates — as we've seen frequently recently, especially over tariffs.

Here's Comerica Bank's chief economist's view of what this week might bring after yesterday's retail sales data:

"Other economic reports will likely be weaker. Headwinds from tariffs, affordability, and fears of an economic slowdown likely weighed on homebuilding last month, and homebuilder sentiment is likely lower in April, too."

Mortgage rates today

The economic reports this week that routinely exert the most influence on mortgage rates have passed. The remaining ones, due this morning, rarely move those rates unless they contain truly shocking data.

As mentioned above, the bond market that mostly determines mortgage rates closes early at 2:30 p.m. Eastern this afternoon for the Easter weekend. And it won't open again until Monday morning. So, we shall not be publishing this daily column tomorrow.

Next week