Hi friends,

Most of the movement in mortgage markets this week has again been driven by changes in oil prices. With very little major economic data released, mortgage rates have inched up to their highest levels in about eight months, reminding us how sensitive long‑term rates are to both inflation expectations and global uncertainty.

The latest weekly jobless claims data from the Department of Labor came in at 210,000 new claims for unemployment insurance, right in line with expectations and far below the elevated readings we saw during the early months of the pandemic. In fact, this level is very similar to 2019, when the labor market was considered quite solid, making jobless claims one of the clearest, most timely indicators that large-scale layoffs are still not the story.

At the same time, other labor market indicators are telling a more nuanced story: companies are slowing down on hiring even as they remain reluctant to lay people off. We’ve effectively entered a “low‑hire, low‑fire” period, made worse by uncertainty around the conflict in the Middle East and higher oil prices. Employers are hiring at the slowest pace since 2013 (excluding the early-pandemic shock), and workers are quitting at the lowest rate in about a decade, reflecting low confidence that they can easily find something better. For job changers and new entrants like recent college grads, that translates to fewer opportunities and a tougher path into the workforce.

Over in Europe, the European Central Bank (ECB) kept its benchmark rate unchanged at 2.0% at its latest meeting, but officials have been clear that further rate hikes are still on the table if higher oil prices push inflation up again. The ECB highlighted that the economic outlook is now “significantly more uncertain” due to the Middle East conflict, and President Christine Lagarde noted that even a “not‑too‑persistent” rise in inflation from the oil shock could justify another hike later this year. Those remarks helped push long‑term European bond yields to their highest levels in roughly eleven years, putting additional upward pressure on global yields, including U.S. mortgage rates.

Looking ahead, markets will stay focused on developments in the Middle East, as well as any new commentary from Federal Reserve officials on the path of interest rates and any policy talk around tariffs. On the data front, JOLTS (job openings) and Consumer Confidence are due Tuesday, the ISM manufacturing index arrives Wednesday, and the ISM services index follows on Friday. The big one is also Friday: the monthly Employment Report, which includes job growth, the unemployment rate, and wage inflation—numbers that can quickly move bond markets and, by extension, mortgage rates.

If you’re thinking about buying, refinancing, or just want to understand how these headlines impact your real estate plans, I’m always happy to walk through what this means for your specific situation.