Episode summary
Logan Mohtashami on the Fed meeting and mortgage rates
HousingWire Daily
· · 17 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Logan Mohtashami said the Fed meeting landed more hawkish than expected, with Jerome Powell signaling that rate cuts are off the table unless inflation improves. He argued the market is now properly priced for no cuts this year because inflation is still above target, the PPI print was hot, and the Fed sees the labor market as soft but not breaking enough to force a policy shift.
He also said the Iran conflict is now a major new variable because it can keep oil, diesel, food, and transport costs elevated. In his view, that makes the Fed even more cautious and helps explain why the 10-year yield moved up and stocks sold off. He said the Fed is effectively saying, “show me” on inflation and that any easing would likely require a clearly worsening labor market.
Mohtashami pushed back on stagflation comparisons, arguing this is not the 1970s because unemployment is still under 5% and wage growth remains above inflation. He added that mortgage demand data has not yet shown a negative response to slightly higher rates, and that purchase applications were still up week over week and year over year.
Key takeaways
- Logan Mohtashami said the Fed’s message was hawkish enough that the market has now priced out rate cuts for 2026.
- He argued the Fed needs to see either better inflation or a clearly breaking labor market before changing guidance.
- Mohtashami said the Iran conflict could keep commodity prices elevated and complicate the inflation outlook.
- He said the 10-year yield around 4.27% is not surprising given weak job creation and softer Fed policy.
- Mohtashami said purchase applications were still positive, up 1% week to week and 12% year over year.
Notable quotes
“the market is properly priced all rate cuts out the door”
“the labor market really needs to break because we don't really care about the headline prints or the revisions anymore”
“We don't have you don't have 4.4% unemployment rate, wage growth above inflation still, and talk about stagflation”
“65 to 75% of what I think the 10-year yield should do is Fed policy”
How the episode opens
Welcome everyone. My guest today is lead analyst Logan Moto Shami to talk about the Fed meeting and what it means for the 10-year yield and mortgage rates. First, I want to thank our sponsor Trust and Will for making this episode possible. Logan, welcome back to the podcast on this Fed day.
Yes. Uh you're in Las Vegas. I'm in Frisco, Texas. I couldn't get internet in the hotel room, so I broke into some meeting room, cracked the code, and we're here live talking about the Fed day because uh uh pretty eventful uh uh uh daily action today.
Incredible. Okay, give us the takeaway. Of course, we didn't get any rate movement.
No one expected any rate movement today. From your perspective, what was the key takeaway takeaway from the Fed meeting today? I thought this was a a a very clear kind of hawkish tone of the precedent.
The the Fed statement wasn't anything too, you know, market moving, but when Powell started to talk and he kind of I think I think the easiest way for me to explain this is that he basically said, "Listen, inflation is up now. We have this conflict. We don't know how bad the conflict's going to be.
But you we really need to like see some improvement in inflation if you want any rate cuts. Um so to me right now the market is properly priced all rate cuts out the door. Okay.
So if there's a Kevin Wars is listening to this. Hide yourself from every camera. Go find a cabin in the middle of nowhere.
lock yourself up until this conflict is over because you cannot come on TV or answer anybody's questions because the the only person that dissented today was Myin and Myin is another Trump boy who's going to do what he wants and even the doves as we talked about before went a little bit hawkish.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- fed meeting
- mortgage rates
- 10-year yield
- inflation risks
Watch the episode
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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