MARKET UPDATE: 10-12-2026

Fed Minutes, Home Prices and Market Volatility

Minutes from the Fed’s last meeting, home price trends, and the latest jobless claims highlighted a relatively quiet week. Plus, how movements in European bond markets affected us here at home. Here’s what you need to know.

  • Fed Minutes: What They May Mean for Rates
  • Quick Market Hits
  • Family Hack of the Week
  • What to Watch Ahead

Fed Minutes: What They May Mean for Rates

The minutes from the Federal Reserve’s September meeting highlighted how important upcoming inflation and labor market data will be in determining the path for interest rates.

To recap, the Fed raised its benchmark Federal Funds Rate by 25 basis points last month, with elevated inflation a key reason for the move. When the Fed raises this rate, it generally aims to slow the economy and put downward pressure on inflation. It’s important to note that the Fed Funds Rate is the overnight borrowing rate for banks and is not the same as mortgage rates.

Bottom line: The Fed’s next meetings are October 27-28 and December 8-9. While the September minutes showed that “most participants” felt another rate hike would “likely be appropriate by year end,” recent inflation data came in softer than expected. Plus, several Fed members (including Governors Michelle Bowman and Philip Jefferson and New York Fed President John Williams) have emphasized the need for more data before making further moves.

As a result, expectations for an October rate hike have fallen significantly.

Quick Market Hits

Home Prices: National home values remained relatively stable in August, with Cotality reporting a 0.1% monthly decline and a 1.8% increase from a year earlier.

Unemployment: New jobless claims fell slightly to 197,000 last week, while continuing claims are around 1.72 million.

Initial claims remain low by historical standards, but they may not capture the full picture. Some people who lose their jobs may turn to freelance, contract or gig work rather than file for unemployment benefits, potentially masking some labor market weakness.

Continuing claims have also fallen from recent highs, though that decline may not entirely reflect people finding new jobs. Some workers may have simply exhausted their benefits.

Bond Market: A bond selloff in Europe pushed global yields higher, contributing to market volatility here at home. Strong demand at U.S. Treasury auctions later helped bring the 10-year yield back below an important technical level.

Family Hack of the Week

Enjoy these Lemon Bars, courtesy of Food Network, on National Lemon Bar Day (October 15) or anytime you’re craving a bright, refreshing treat. This easy recipe makes 20 squares or 40 triangles.

Preheat your oven to 350 degrees Fahrenheit. To make the crust, cream 1/2 pound room-temperature unsalted butter and 1/2 cup sugar in the bowl of an electric mixer until light and fluffy. Combine 2 cups flour and 1/8 teaspoon kosher salt, then gradually add the mixture to the butter with the mixer on low. Mix just until combined. Transfer the dough to a well-floured surface and gather it into a ball. Flatten the dough with floured hands and press it evenly into a 9-by-13-by-2-inch baking pan, building up a 1/2-inch edge on all sides. Chill for 15 minutes.

Bake the crust for 15 to 20 minutes, until very lightly browned. Let cool on a wire rack, leaving the oven on.

For the filling, whisk together 6 extra-large room-temperature eggs, 3 cups sugar, 2 tablespoons grated lemon zest (from 4 to 6 lemons), 1 cup freshly squeezed lemon juice, and 1 cup flour. Pour the filling over the crust and bake for 30 to 35 minutes, until set. Let cool to room temperature.

Cut into squares or triangles and dust with confectioners’ sugar before serving.

What to Watch Ahead

After the market closures Monday for Columbus Day, Existing Home Sales data is due Tuesday, followed by two closely watched inflation reports: the Consumer Price Index (CPI) on Wednesday and the Producer Price Index (PPI) on Thursday. We’ll also get the latest weekly jobless claims and Retail Sales on Thursday.

Author: Abdel Khawatmi with PRMG Got Mortgages | 201-679-0422