{"id":19837,"date":"2026-05-28T23:25:56","date_gmt":"2026-05-28T23:25:56","guid":{"rendered":"https:\/\/globalnewstoday.uk\/index.php\/2026\/05\/28\/how-is-the-economy-affecting-mortgage-rates-guaranteed-rate\/"},"modified":"2026-05-28T23:25:56","modified_gmt":"2026-05-28T23:25:56","slug":"how-is-the-economy-affecting-mortgage-rates-guaranteed-rate","status":"publish","type":"post","link":"https:\/\/globalnewstoday.uk\/index.php\/2026\/05\/28\/how-is-the-economy-affecting-mortgage-rates-guaranteed-rate\/","title":{"rendered":"How is the economy affecting mortgage rates? – Guaranteed Rate"},"content":{"rendered":"

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Written by
Alex Ceko
Published on
05\/28\/2026
Tags
Mortgage news
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The\u00a0overall\u00a0economy\u00a0is\u00a0one of the major\u00a0influences on\u00a0the direction\u00a0of\u00a0mortgage rates<\/a>.\u00a0Knowing the\u00a0aspects of the economy that\u00a0most heavily influence mortgage rates\u00a0could allow you to\u00a0gauge\u00a0when mortgage rates\u00a0may fall or rise.\u00a0
Since last week\u2019s mortgage rate spike to just over 6.6%,\u00a0rates\u00a0have dropped\u00a0to\u00a0just\u00a0over 6.4%.\u00a0The\u00a0sudden spike and\u00a0subsequent\u00a0drop were both reactions to\u00a0fluctuations\u00a0in\u00a0the\u00a0U.S.\u00a0economy.\u00a0Following news of changes in the economy could help you\u00a0determine\u00a0when to apply for a home loan or mortgage refinance.\u00a0
Ready to get a mortgage or refinance your current one?\u00a0Start an online application today<\/a>!\u00a0
Here\u00a0are\u00a0a few of the\u00a0many economic factors that drive the base mortgage rate.\u00a0\u00a0
Treasuries tend to compete for the same capital that goes into mortgages, typically tying the two together. In short, when Treasury yields fall, mortgage rates tend to\u00a0follow. Rates can go up\u00a0when\u00a0Treasury yields rise, too.\u00a0Keep in mind that\u00a0the relationship is directional rather than one-for-one,\u00a0so\u00a0mortgage\u00a0rates\u00a0don\u2019t\u00a0necessarily fluctuate in\u00a0exactly the same\u00a0way.\u00a0
Inflation expectations and current geopolitical tension have\u00a0raised the Treasury yield<\/a>\u00a0in the\u00a0past week.\u00a0
The Federal Reserve Bank\u00a0meets eight times a year to set interest rates used for borrowing money.\u00a0It\u00a0sets\u00a0rates\u00a0to increase employment and\u00a0stabilize\u00a0inflation.\u00a0While the Fed does not set rates on mortgages,\u00a0its\u00a0decisions influence mortgage rates.\u00a0When the Fed announces a rate increase, mortgage rates could rise as well, and when\u00a0it\u00a0announces reductions, mortgages rates tend to fall\u00a0accordingly.\u00a0
In the next five\u00a0Fed\u00a0meetings scheduled for this year,\u00a0professionals are predicting<\/a>\u00a0that the Fed will not cut rates, with a larger number predicting an increase as the year continues.\u00a0Just over\u00a050.5% of professionals are predicting a\u00a0rate increase\u00a0by the\u00a0final\u00a0meeting of the year. With rate cuts looking\u00a0unlikely, mortgage rates reacted by increasing recently.\u00a0
Recent\u00a0geopolitical events<\/a>\u00a0like the Iran conflict and oil price increases have both\u00a0increased inflation in the United States. As we have mentioned in the\u00a0previous\u00a0sections, a rise in inflation will\u00a0affect\u00a0a number of\u00a0factors that contribute to the current mortgage rate.\u00a0
An easing in the conflict between Iran and the United States could be beneficial to current oil prices and end up lowering\u00a0current mortgage rates.\u00a0
Mortgage rates are volatile,\u00a0making it\u00a0difficult\u00a0to predict their future and where they might end up.\u00a0\u00a0
If inflation rates cool down in the coming months, we may see a surprising and beneficial\u00a0drop in\u00a0mortgage rates. However, rates\u00a0at the\u00a0moment seem to be in a higher-for-longer period,\u00a0so\u00a0it may be a while before we see mortgage rates drop like they did\u00a0earlier this year<\/a>.\u00a0\u00a0
If you are looking\u00a0to\u00a0gauge\u00a0where mortgage rates\u00a0are\u00a0headed, there is some data that could help.\u00a0\u00a0
The first thing you will want to\u00a0check regularly is\u00a0current mortgage rates<\/a>.\u00a0On top of\u00a0seeing\u00a0current mortgage rates, this will\u00a0also\u00a0show you\u00a0the recent history of rates, potentially giving you an idea of what direction rates are heading.\u00a0
You will also want to\u00a0keep up\u00a0with\u00a0the Fed\u2019s\u00a0rate\u00a0decisions,\u00a0especially shortly before\u00a0it\u00a0makes\u00a0its\u00a0decision. The Fed meets eight times a year,\u00a0and\u00a0after\u00a0its\u00a0meetings end and\u00a0it\u00a0announces\u00a0its\u00a0decision, mortgage rates tend to react to\u00a0its\u00a0choice.\u00a0Before\u00a0its\u00a0meetings end and a decision is announced,\u00a0experts will\u00a0offer\u00a0predictions on where they think rates are headed.\u00a0Expert predictions could have a\u00a0slight\u00a0effect\u00a0on rates before the Fed\u2019s official decision.\u00a0
The final thing you will want to keep an eye on is world news and\u00a0understand\u00a0how it may affect the\u00a0U.S.\u00a0economy.\u00a0
Of course, predicting mortgage rates is\u00a0not an exact science,\u00a0and\u00a0it is still hard to accurately know where rates are going.\u00a0
Mortgage rates\u00a0change often,\u00a0while they may\u00a0see marginal improvements from\u00a0where they currently\u00a0are,\u00a0it is impossible to say for certain\u00a0in\u00a0which direction they are headed.\u00a0
With inflation and gas prices rising, geopolitical conflicts continuing and the prediction that the Fed will\u00a0increase\u00a0rates before the end of the year, it\u00a0may be a while before we see mortgage rates drop\u00a0significantly.\u00a0
If you are hoping to get a home loan, the best advice is to\u00a0get a\u00a0mortgage now\u00a0in case rates\u00a0continue to rise. In the case that rates drop after you have your mortgage, you can always refinance\u00a0your loan to take advantage of the lower rates.\u00a0Getting a fixed-rate mortgage now could protect you from any future rate\u00a0increases.\u00a0
Start\u00a0a home loan application today<\/a>\u00a0and get a mortgage before\u00a0rates rise\u00a0any higher.\u00a0
\u00a0
\u00a0<\/p>\n

<\/sub>
Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not\u00a0represent\u00a0an approval for financing or interest rate guarantee. Refinancing your mortgage may increase costs over the term of your loan. Restrictions may apply.\u202f<\/em><\/sub>\u00a0<\/sub>
All information provided in this publication is for informational and educational purposes only, and in no way is any of the content\u00a0contained\u00a0herein\u00a0to be construed as financial, investment, or legal advice or instruction.\u00a0Rate\u00a0does not guarantee the quality, accuracy,\u00a0completeness\u00a0or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error-free. Some information in the publication may have been provided by third parties and has not necessarily been verified by\u00a0Rate.\u00a0Rateits\u00a0affiliates and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action.<\/em><\/sub>\u00a0<\/sub>
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Please note that applications, legal disclosures, documents or other material related to Rate products or services promoted on this page are offered in English only. The Spanish translation of this page is for the convenience of our clients; however, not all pages are translated. If there is a discrepancy between the content of the translated page and the content of the same page in English, the English version will prevail.\u2028<\/p>\n

Rate\u00a0may\u00a0choose\u00a0to\u00a0recommend\u00a0Rate\u00a0Insurance,\u00a0LLC.\u00a0Rate\u00a0has\u00a0100%\u00a0ownership\u00a0and\u00a0a\u00a0direct\u00a0or\u00a0indirect\u00a0financial\u00a0interest\u00a0in\u00a0Rate\u00a0Insurance,\u00a0LLC.\u00a0You\u00a0are\u00a0not\u00a0required\u00a0to\u00a0use\u00a0Rate\u00a0Insurance,\u00a0LLC.\u00a0<\/p>\n

Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Refinancing your mortgage may increase costs over the term of your loan. Restrictions may apply.
Savings, if any, vary based on the consumer\u2019s credit profile, interest rate availability, and other factors. Contact Rate for current rates. Restrictions apply.
Copyright \u00a9 2026 Guaranteed Rate, Inc. D\/B\/A Rate. All rights reserved.<\/strong>
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Operating as Guaranteed Rate, Inc. in New York.\u2028
The company name, Guaranteed Rate, should not suggest to a consumer that Guaranteed Rate provides an interest rate guaranteed prior to an interest lock.<\/p>\n

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