Will the Fed Raise Rates This Week? Mortgage Rates Could Move Fast

The Federal Reserve meets July 28–29, and the bond market is already reacting to inflation, oil prices, and the possibility of another rate increase.

Mortgage rates have been moving higher again, and this week could bring another round of volatility.

The Federal Open Market Committee will meet on July 28–29, with its rate decision scheduled for 2:00 p.m. Eastern on Wednesday, July 29, followed by a press conference at 2:30 p.m. Inflation has cooled, energy prices remain volatile, and markets are no longer treating a hike as a remote possibility.

At the time of writing, the CME FedWatch Tool showed roughly a 60% probability that the Fed would hold its target range at 3.50%–3.75% and about a 40% probability of a quarter-point increase to 3.75%–4.00%. Those probabilities are live market estimates and can change quickly before the announcement.

For homebuyers and homeowners, the bigger question is whether Wednesday’s decision—and the explanation that follows—pushes Treasury yields and mortgage-backed securities higher or lower.