This Market Update is written by our Capital Market specialists each week to bring you insight into what's happening in the market and how it may affect mortgage rates and real estate trends.
Market Commentary:
For February 6th to February 12th, US interest rate news centered on the Federal Reserve holding rates steady after January's pause, with markets anticipating future moves based on upcoming inflation and jobs data, while Treasury yields showed slight fluctuations, with the 2-Year yield near 3.52% and 5-Year near 3.74% by mid-week, reflecting cautious economic outlooks.
The Fed remains on hold, prioritizing inflation control over aggressive easing. Strong business investment, particularly in AI, and potential tariff impacts are noted factors influencing Fed thinking. Markets are closely watching upcoming economic reports for signs of whether the Fed might need to adjust its cautious stance.
FedWatch: Target rate (in bps) possibilities, according to the CME Group (as of 02/12/2026 – 12:00 PM EST):
Credit Card Balances Rise in Q4 2025:
January Jobs:
January net employment grew by a strong 130,000 jobs. Additionally, the work week rose 0.3%, and the unemployment rate fell to 4.3% from 4.4% despite the labor force participation rate rising to 62.5% from 62.4%. Moreover, part-time employment fell by 453,000, and quits rose by 197,000. The only problem, healthcare/social assistance was responsible for 123,500, or 95% of all jobs. Outside of healthcare/social assistance, job growth has been zero since 12/24. - Elliot Eisenberg, Economist
News You Can Use:
· Fed's Schmid: Further rate cuts could allow higher inflation to persist for longer |investingLive
· U.S. payrolls rose by 130,000 in January, more than expected; unemployment down to 4.3%
· FHA mortgage demand rises as borrowers face affordability challenges
· Atlanta Fed GDPNow Q4 tracker 3.7% vs 4.2% prior | investingLive
· US consumer confidence improves in February - Breaking The News
· The Average American Has Less Than $1,000 Saved for Retirement
· Major Homebuilders Weigh Plans for a Million Entry-Level 'Trump Homes'
*Communication is intended for Industry Professionals only and not intended for Consumer Distribution
Interest rate and annual percentage rate (APR) are based on current market conditions as of 02/12/2026, are for informational purposes only, are subject to change without notice and may be subject to pricing add-ons related to property type, loan amount, loan-to-value, credit score and other variables. Estimated closing costs used in the APR calculation are assumed to be paid by the borrower at closing. If the closing costs are financed, the loan, APR and payment amounts will be higher. Contact us for details. Additional loan programs may be available. Accuracy is not guaranteed, and all products may not be available in all borrower's geographical areas and are based on their individual situation. This is not a credit decision or a commitment to lend. Actual interest rate, APR, and payment may vary based on the specific terms of the loan selected, verification of information, your credit history, the location and type of property, and other factors as determined by Prosperity Home Mortgage, LLC. Not available in all states. Rate is as of 02/12/2026 and is subject to change at any time without notice. Opinions, estimates, forecasts, and other views contained in this document are those of Freddie Mac’s economists and other researchers, do not necessarily represent the views of Freddie Mac or its management, and should not be construed as indicating Freddie Mac’s business prospects or expected results. Although the authors attempt to provide reliable, useful information, they do not guarantee that the information or other content in this document is accurate, current, or suitable for any particular purpose. All content is subject to change without notice. All content is provided on an “as is” basis, with no warranties of any kind whatsoever. Information from this document may be used with proper attribution.
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