Mortgage update 12/10/2025

The Federal Reserve cut interest rates by 25 basis points to the 3.5-3.75% range in its third interest rate cut of 2025.

Mortgage rates improved not due to the cut itself but rather to comments made by Powell that job gains may have been overstated and growing evidence that inflation is coming down.

Additionally, just 12 days after Quantitative Tightening ended. The Fed will begin purchasing $40 billion worth of Treasuries over the next 30 days.

The “dot plot” (Fed’s projections) indicated just one more reduction in 2026 and another in 2027.

Some other takeaways from Powell’s presser:

-Powell more or less declared the recalibration phase complete—they’re now “well positioned to wait.”

He blamed the committee’s divide on the unusual tension in the dual mandate and validated both sides of the debate.

Jerome Powell on the housing market:

We can raise and lower interest rates, but we don’t really have the tools to address, you know, a secular housing shortage, a structural housing shortage

Today’s national average 30-year mortgage rate is 6.30%