This week’s economic news showed a labor market that is cooling but not collapsing. Inflation remains sticky, with PCE up 4.1% year-over-year and core PCE at 3.4%, which helps explain why bond yields and mortgage rates have increased. The good news for real estate is that oil has dropped back to about $69-$72 a barrel, and the 30-year fixed mortgage rate eased slightly to 6.43%.
Mortgage rates – Every Thursday, Freddie Mac publishes interest rates based on a survey of mortgage lenders throughout the week. The Freddie Mac Primary Mortgage Survey reported that mortgage rates for the most popular loan products as of July 2, 2026, were as follows: The 30-year fixed mortgage rate was 6.43%, down from 6.49% last week. The 15-year fixed was 5.79%, down from 5.84% last week. The graph below shows the trajectory of mortgage rates over the past year.
Job creation slowed in June – The Bureau of Labor and Statistics reported that 57,000 new jobs were created in June, down from 172,000 new jobs in May. The unemployment rate ticked down to 4.2% from 4.3%, in March, April, and May. The labor force participation rate (The percentage of people age 16 or older working or looking for work) dropped to 61.5%, its lowest reading since March 2021. Average hourly wages increased 3.5% from one year ago, which remains below the most recent inflation reading of 4.2%.
Stock markets – The Dow Jones Industrial Average closed the week at 52,900.07, up 2% from 51,876.11 last week. It is up 10.1% year-to-date from 48,063.29 on December 31, 2025. The S&P 500 closed the week at 7,483.24, up 1.8% from 7,354.02 last week. The S&P is up 9.3% year-to-date from 6,845.50 on December 31, 2025. The Nasdaq closed the week at 25,832.67, up 2.1% from 25,297.62 last week. It is up 11.1% year-to-date from 23,241.99 on December 31, 2025.
U.S. Treasury Bonds – The 10-year treasury bond closed the week yielding 4.49%, up from 4.38% last week. The 30-year treasury bond yield ended the week at 4.98%, up from 4.87% last week. We watch bond yields because mortgage rates follow bond yields.
Wishing you a happy Independence Day as we celebrate our nation’s 250th birthday!