Welcome to our Market Update, written by our very own Capital Market experts. This blog is designed to give you a glance into the most important market events happening this week.
Market Commentary:
Interest rates remained flat this week. If any doubts remain about whether the Federal Reserve will be lowering its key interest rate later this month, the budget loggerheads a few blocks away in the nation’s capital may have cemented the move.
Particularly if the impasse stretches out past few days, Chair Jerome Powell and his fellow central bankers will likely err on the side of caution, which in this case would be a bias towards easing, Wall Street experts say.
The next Federal Reserve policy committee meeting is scheduled for Oct. 28 and 29. The Fed is widely expected to cut the fed funds rate by a quarter of a percentage point to a range of3.75% to 4%. Fed officials are cutting rates because they're concerned about signs of weakness in the labor market and want to lower borrowing costs to encourage hiring.
Fed Watch: Target rate (in bps) possibilities, according to the CME Group (as of 10/02/2025 – 12:00 PM EST):
Case-Shiller: Growth Slows to +1.7% Annual Gain:
Housing Inventory:
It looks like the federal government will likely shut down on 10/1/25, so get ready for some scary-sounding GDP loss numbers. Don’t believe them. Once the government reopens, all the missed pay and bills get covered. While the initial hit sounds bad, most of it gets recouped. At worst, shutdowns cost $1 billion/day. Even a 35-day one, the longest ever, will dent GDP by just 0.12%. Quite manageable. - Elliot F. Eisenberg the Bowtie Economist
News You Can Use:
· Consumer confidence is lower than expected as Wall Street braces for shutdown data blackout
· Boston Fed President Collins sees caution on future interest rate cuts
· How a Government Shutdown Could Impact the Housing Market - Newsweek
· ATTOM LAUNCHES TRANSPARENT OWNER TO REVEAL TRUE PROPERTY OWNERSHIP
· Starter-Home Sales Up 4% as Demand for Higher-Priced Options Stumbles
· Share of Mortgages with Rates Above 6% Climbs to 10-Year High
· FTC claims Zillow paid Redfin $100 million to dominate online rental listings | CNN Business
· FICO launches direct mortgage score licensing, cuts costs for lenders By Investing.com
*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 10/02/2025, 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 10/02/2025 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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