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Report: Mortgage rates hold near 7 percent, Fed pauses

The rates could stay high or rise if Trump’s tariffs drive inflation

Mortgage Rates Stay Near 7% as Fed Holds; Housing Slows

Mortgage interest rates peaked at 7.04 percent in January, dropped to the mid-6 percent range in March, then held between 6.75 and 6.9 percent since May, ending June at 6.77 percent, according to Forbes.

MORTGAGE INTEREST RATES peaked at 7.04 percent in January, dropped to the mid-6 percent range in March and have stayed between 6.75 and 6.9 percent since May, according to a Forbes report. The 30-year fixed rate was 6.85 percent in early June and fell to 6.77 percent by month-end.

The Federal Reserve is delaying rate cuts as it tracks inflation data, Forbes reported. However, mortgage rates could remain high or increase if President Donald Trump’s tariff policies drive inflation. Many housing analysts also expect mortgage rates to ease only by late 2025, if at all.


“Mortgage rates can fall with a Fed rate cut if inflation is controlled,” said Lawrence Yun, National Association of Realtor’s chief economist, according to Forbes. “But they won’t drop to 4 percent or 5 percent because of the large national debt. They could reach 6 percent with rate cuts and stable inflation.”

The Federal Open Market Committee voted unanimously to keep the federal funds rate unchanged at its June meeting, the report said. The rate, which applies to overnight borrowing between banks and credit unions, indirectly affects mortgage rates.

After holding rates at 5.25 percent to 5.5 percent from July 2023 to August 2024, the Fed cut rates three times between September and December 2024, totaling one percentage point. The June pause keeps the 4.25 percent to 4.5 percent target range and marks the fourth straight meeting with no rate change.

The Fed’s latest projections show higher inflation and unemployment through 2027 compared to March. The 2025 rate outlook remains unchanged, with two cuts expected, bringing the rate to 3.75 percent to 4 percent by year-end. Some experts say rates could decline if inflation cools slightly and job growth continues, leading to a Fed rate cut in September.

“Mortgage rates could fall even before the rate cut in response to these indicators,” Lisa Sturtevant, chief economist at BrightMLS, was quoted as saying. “A decline in rates later this summer could spur housing activity, bringing buyers off the sidelines to take advantage of lower rates and more inventory.”

The next two-day FOMC meeting is scheduled for July 29 to 30. Some policymakers signaled openness to a July rate cut, but economists see it as unlikely, expecting initial effects of Trump’s tariffs on prices.

After the June meeting, odds of a July rate pause were about 4-to-1, while expectations for a September rate cut exceeded 4-to-1, the report said, citing the CME FedWatch tool, which tracks predicted Fed policy moves.

A recent PricewaterhouseCoopers report found that hospitality dealmakers entered 2025 cautiously, but capital market and trade policy volatility has driven a shift toward targeted M&A to reshape portfolios, refine strategy and expand digital capabilities.

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