Mortgage rates spent most of the week on a modest downward trajectory, but ultimately ended up higher following statements from the Federal Reserve. In the past several weeks, mortgage rates have proven resilient to several economic data reports which would typically push them firmly higher.

The Federal Reserve’s insistence that recent inflation figures were transitory and that any changes to monetary policy wouldn’t be necessary until the economy showed far more substantial progress has kept rates at bay for months, and in recent weeks, it increasingly seemed that it would take a shift in this stance for rates to head meaningfully upward. At the June FOMC meeting on Wednesday, the Fed announced that they expect to make two interest rate hikes in 2023 and predicted higher inflation this year, a signal that they are now more likely to make some changes to policy than they were even just a few months ago (in March, they stated that no hikes would be necessary until 2024). Treasury yields surged higher following the announcement, mortgage rates followed suit and more upward movements are likely on the way in the coming days.

So, while policy remains accommodative, these more hawkish signals from the Fed may finally usher in some meaningful upward movements in mortgage rates.