Good Morning. 

We made it to Friday, and the markets are wrapping up a tense week on a cautiously optimistic note. Treasury yields edged slightly lower this morning as the U.S. government shutdown enters its 17th day, keeping investors on edge and data desks quiet. Without fresh economic reports, Wall Street has been trading mostly on headlines, Fed commentary, and bank earnings. Still, the good news is this: the 10-Year Treasury is hovering below 4.00%, and that’s helping mortgage rates hold steady or tick slightly lower — a much-needed bit of calm in a choppy October.

When we say yields are “inching lower,” it’s another way of saying bond prices are rising — investors are buying Treasuries for safety amid political gridlock and bank stress. This tug-of-war between risk and safety is what ultimately drives mortgage rates day to day. So, while the headlines may sound gloomy, for our borrowers, it’s quietly positive news.

Treasury & MBS Check

• 10-Year Treasury: 3.96% (1 bp)

• 2-Year Treasury: 3.43% (3 bps)

• 30-Year Treasury: 4.60% (unchanged)

• MBS (Mortgage-Backed Securities): Modestly improved, following Treasuries higher

The 4.00% level remains an important psychological and technical pivot. If yields stay below that, we could see lenders continue small rate improvements into next week.

Mortgage Rates (MND Daily Survey)

Loan Type	Rate	Change
30-Year Fixed	6.23%	0.04%
15-Year Fixed	5.80%	0.02%
30-Year Jumbo	6.20%	No change
7/6 SOFR ARM	5.71%	No change
30-Year FHA	5.98%	0.02%
30-Year VA	5.99%	0.03%

Rates are drifting lower, not dropping sharply — but in a market where volatility has ruled for months, small wins like this add up. The spread between MBS and Treasuries remains wide but stable, giving rate sheets room to stay competitive.

Why Bonds Are Quiet

With the shutdown blocking key data (like inflation and job reports), investors are flying half-blind. Instead, they’re tuning in to speeches from Fed officials and earnings results for clues. St. Louis Fed President Alberto Musalem is expected to speak today — markets will listen closely for any hints of dovish leanings.

Meanwhile, Wall Street is digesting a new concern: bad loans at regional banks. Zions and Western Alliance disclosed losses tied to commercial and auto lending, sparking fears of broader credit issues. CNBC’s Jim Cramer summed it up bluntly: “Nothing motivates the Fed to move faster than credit losses.” That’s one reason traders are betting the next Fed cut could come sooner than expected.

What This Means for Rate Sheets

• Sub-4.00% 10 Year = Small lender improvements likely

• Above 4.10% = Rate sheets could worsen 0.125–0.25%

• Watch the shutdown headlines: the longer it lasts, the softer yields could go

Lock/Float Playbook

• Closing in 0–30 Days: Lock — protect your wins heading into the weekend

• Closing in plus 30 Days: Float cautiously — more room for a bond rally

• Refi Pipeline: Great window to reprice pre-approved clients who were waiting for sub-6.25% options

Talking Points for Clients & Agents

• “Treasury yields have dipped back under 4%, easing pressure on mortgage rates.”

• “Markets are pricing in a possible Fed rate cut later this year — a good sign for long-term buyers.”

• “Even small rate dips can mean thousands in savings. This is the time to re-run numbers with your lender.”

Today’s Calendar

• Economic Data: Housing Starts, Building Permits (limited due to shutdown)

• Earnings: American Express, Truist, Ally, State Street, Comerica

• Fed Speakers: St. Louis Fed President Musalem

Quick Coaching Tip

When explaining rates, translate complexity into calm:

“Think of mortgage rates like a mirror of the 10-Year Treasury — when investors get nervous and buy bonds, yields fall, and rates follow. That’s what’s happening this week — a little bit of anxiety in the market is giving homebuyers a quiet advantage.”

Bottom Line

Even with the noise of a government shutdown, bank headlines, and AI stock swings, bonds are quietly doing their job — signaling stability. The 10-Year Treasury under 4% is your friend today. Keep your buyers encouraged — lower volatility and steady rates are signs that confidence is slowly returning to the mortgage market.

Let’s finish the week strong.