Mortgage rates were flat this week, but they appear ready to fall as markets continue to digest comments from the Federal Reserve Chair.

After falling sharply in response to October CPI data, mortgage rates have been remarkably steady over the last few weeks. Investors have clearly viewed the inflation report, which hinted at a long-awaited deceleration in consumer price growth, as evidence that the Fed will take its foot off the macroeconomic brake and slow its pace of interest rate hikes. This hypothesis seemed to be validated on Wednesday as Fed Chair Powell signaled in a speech that the central bank is likely to decelerate its pace of rate increases beginning in their December meeting, and are seeing signs that further inflation slowdowns should be coming in the next few months. The statement was more than enough for investors.  Bond yields – which influence mortgage rates – declined in response. Mortgage rates are likely to follow suit in the coming days.

That said, Powell pointed out that more work needs to be done to bring inflation back to the Fed’s target. And there are plenty of blockbuster economic data releases on the horizon and geopolitical dynamics that could alter this outlook. But it’s likely that mortgage rates will enjoy more calm, and are likely to ease down, leading up to the next key CPI report, due in a couple of weeks.