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Tuesday, August 25, 2026
OPENING CURRENT
Treasury yields retreated Monday, giving mortgage pricing some breathing room after Friday’s selloff. The 10-year closed at 4.70%, but today’s July new-home-sales report and 2-year note auction can quickly decide whether that improvement holds.
THE LEAD CURRENT
Mortgage Pricing Gets a Reprieve—Today’s Housing Report Could Decide Whether It Holds
WHAT HAPPENED
Treasury yields retreated Monday after Friday’s selloff. The 10-year Treasury declined from 4.74% to 4.70%, while the 30-year fell from 5.27% to 5.23%. Freddie Mac’s latest weekly survey placed the 30-year fixed mortgage at 6.65%, down from 6.67%, and the 15-year average at 5.95%.
WHY IT MATTERS
Monday’s bond rally may support modestly better mortgage pricing, but it is not yet a confirmed breakout. The 10-year remains near 4.70%, a level that has repeatedly limited sustained mortgage-rate improvement. Borrowers should view the opportunity as incremental, while mortgage professionals should anchor lock decisions to payment, cost and closing timeline rather than a prediction about one report.
WHAT TO WATCH
July new-home sales will be released at 10:00 a.m. ET today. Treasury will also auction 2-year notes today, followed by 5-year notes Wednesday and 7-year notes Thursday. The Jackson Hole Economic Policy Symposium begins Thursday and runs through Saturday.
SOURCE: U.S. Treasury and Census Bureau → https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?field_tdr_date_value=2026&type=daily_treasury_yield_curve | https://www.census.gov/economic-indicators/calendar-listview.html
RATES & MARKETS
Monday’s Treasury close: 2-year 4.24%; 5-year 4.41%; 10-year 4.70%; 30-year 5.23%. The long end improved, but the 10-year remains the key mortgage signal. A sustained move below 4.70% would be constructive; below 4.65% would provide stronger confirmation. A return above 4.75% would increase the risk of worse lender pricing.
SOURCE: U.S. Treasury → https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?field_tdr_date_value=2026&type=daily_treasury_yield_curve
HOUSING & ORIGINATIONS
June new-home sales reached a 628,000 annual rate. Inventory stood at 485,000 homes, representing 9.3 months of supply. The median sales price was $398,300. Today’s July report will show whether buyers responded to recent rate stability and builder offerings.
Mortgage implication: Weak demand paired with elevated inventory could reinforce affordability concerns and support bonds; stronger sales could place renewed pressure on Treasury yields and mortgage pricing.
SOURCE: U.S. Census Bureau and HUD → https://www.census.gov/construction/nrs/current/index.html
POLICY & REGULATION
Federal Reserve minutes released August 19 showed that several participants favored a 25-basis-point increase at the July meeting. Many participants believed additional tightening could become necessary if inflation failed to decline. Those minutes leave markets sensitive to any change in the Fed’s tone during Jackson Hole.
Status: Official minutes from the July 28–29, 2026 FOMC meeting.
SOURCE: Federal Reserve → https://www.federalreserve.gov/monetarypolicy/fomcminutes20260729.htm
COMPANIES, PEOPLE & TECHNOLOGY
Freddie Mac continues to emphasize the potential savings from shopping among lenders. Mortgage teams should make comparisons transparent by presenting the rate, points, lender fees, APR and total payment using same-day pricing.
SOURCE: Freddie Mac PMMS → https://www.freddiemac.com/pmms
WHAT THEY SAID
Sam Khater — Chief Economist, Freddie Mac
Context: Freddie Mac’s August 20, 2026 Primary Mortgage Market Survey.
“The 30-year fixed-rate mortgage declined this week averaging 6.65%.”
Sam Khater · Freddie Mac PMMS, August 20, 2026
Why it matters: The weekly benchmark improved, but Monday’s live Treasury levels remain the more immediate signal for lender pricing.
ORIGINAL SOURCE: Freddie Mac → https://www.freddiemac.com/pmms
CURRENT DEPTH
The 10-Year Is Back at the Decision Line
Monday’s decline to 4.70% improved the immediate rate outlook, but it did not establish a sustained rally. Today’s housing release creates a clear decision point: a weaker report could push the 10-year below resistance and improve mortgage pricing, while stronger sales—or weak Treasury-auction demand—could quickly erase Monday’s progress.
THE MORNING CURRENT
Bond relief — The 10-year Treasury fell four basis points to 4.70%, reversing most of Friday’s increase. Source: https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?field_tdr_date_value=2026&type=daily_treasury_yield_curve
Housing catalyst — July new-home sales arrive at 10:00 a.m. ET today. Source: https://www.census.gov/economic-indicators/calendar-listview.html
Supply test — Treasury begins three consecutive days of note auctions with the 2-year today. Source: https://home.treasury.gov/system/files/221/Tentative-Auction-Schedule.pdf
WHEN TO LOCK
10-Year Treasury: 4.70% at Monday’s close, down four basis points from Friday.
Lock bias: Neutral to cautiously lock — Monday’s bond rally improved the starting point, but today’s housing report and Treasury auction can trigger intraday repricing.
Closing within 15 days: Favor locking if the payment and costs work.
Closing in 15–30 days: Float only with active monitoring, a defined improvement target and a stop-loss; consider a float-down option.
Closing beyond 30 days: Selective floating may be reasonable if the borrower can tolerate worse pricing and has access to a float-down option.
Key levels: Below 4.70% is constructive; below 4.65% is stronger confirmation; above 4.75% increases lock urgency.
Today’s trigger: July new-home sales at 10:00 a.m. ET, followed by the 2-year Treasury note auction.
Market commentary only; borrower strategy should reflect the loan scenario, closing timeline and available lender pricing.
WHAT TO WATCH TODAY
10:00 a.m. ET — July new-home sales; watch demand, inventory and pricing for the bond-market response.
Later today — Treasury’s 2-year note auction; watch whether the 10-year holds below 4.70%.
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