Fed Chair Warsh Won’t Signal the Next Rate Move, and Mortgage Rates Sit Near a Three-Year High

Federal Reserve Chair Kevin Warsh declined on Friday to say what the central bank will do at its October and December meetings. Speaking in Bangkok, he told an audience that the Fed is committed to price stability but would not preview its next decision. He made the remarks in a conversation with IMF Managing Director Kristalina Georgieva at the IMF and World Bank annual meetings, according to reporting by the Associated Press (AP via PBS NewsHour).

The backdrop matters. The Fed raised its key rate by a quarter point to about 3.9% in September, its first increase in three years, and Warsh said the central bank had removed some monetary accommodation roughly a month earlier. Minutes from that meeting show most officials expect another increase will probably be needed this year, AP reported.

Warsh also pointed to artificial intelligence. He said AI-driven investment is one of the forces pushing inflation higher, while calling the technology the most consequential change of his lifetime and predicting a large long-term benefit for the economy. The Fed has an AI task force scheduled to meet on November 16. President Trump has pressed the Fed to cut rates and criticized the committee after the September hike, though AP notes he has continued to express support for Warsh.

Where mortgage rates stand right now

Homebuyers feel the Fed indirectly, so the more useful number is the one Freddie Mac published on Thursday. The average 30-year fixed rate came in at 7.40%, unchanged from the previous week and up from 6.27% a year ago. That ended a seven-week climb and sits at the highest level since late 2023, AP reported (AP via WPXI). The 15-year fixed averaged 6.71%, down slightly from 6.73% a week earlier and well above the 5.52% of a year ago, per Freddie Mac’s own release (company statement via GlobeNewswire).

Mortgage rates tend to follow the 10-year Treasury yield rather than the Fed’s short-term rate. That yield was 5.10% on Thursday after topping 5.30% earlier this month, compared with 3.97% before the U.S. war with Iran began in late February, according to AP. The conflict lifted oil prices and inflation, and bond market volatility did the rest. The 30-year mortgage rate briefly dipped to 5.98% in late February; since then it has risen 1.42 percentage points, which AP calculates adds roughly $376 a month to the payment on a $400,000 loan.

What the Fed’s silence means for buyers

Because Warsh would not signal a direction, the market is left to read other clues. CME Group data cited by AP put the odds of a December rate hike at 64.6%, up from 49.9% a month ago. Traders broadly expect the Fed to hold at its meeting later this month, which is roughly two weeks away. Realtor.com economist Jiayi Xu said recent consumer and wholesale price reports, both hotter than economists expected, could push the Fed toward a hike by December and possibly more increases in early 2027. Fannie Mae’s forecast has the 30-year rate averaging 7.4% in the fourth quarter and 7.5% in 2027.

Demand is showing the strain. The Mortgage Bankers Association reported that mortgage applications fell 2.7% last week, and adjustable-rate loans made up 10.5% of applications, the highest share in a year as buyers look for a lower starting payment. We covered the trade-offs in our plain comparison of fixed and adjustable mortgage rates, and our earlier post on the 7.40% reading has the weekly numbers. The mix of weak hiring and sticky prices is also why housing is being pulled in two directions, a tension we laid out in this explainer.

Questions worth putting to a lender this week

Nobody, including the Fed chair, is offering a forecast you can plan a purchase around. What a buyer can do is ask better questions of the lender and run the numbers for more than one scenario:

• How long can the rate be locked, what does an extension cost, and is there a float-down option if rates fall?
• What is the monthly payment at today’s rate, and what is it a quarter point higher? Our 15-year versus 30-year payment math shows how to run both.
• If an adjustable-rate loan is on the table, how long is the fixed period, what are the adjustment caps, and what would the payment be at the cap?
• Can the lender provide a Loan Estimate on the same day, for the same loan amount and scenario, as other lenders you are comparing?
• If points are offered to lower the rate, how many months does it take to break even, and how long do you expect to stay in the home?

None of this tells you where rates are headed, and it is not meant to. The honest read of Friday’s remarks is that the next move depends on inflation data the Fed has not yet seen, with Warsh himself saying so by refusing to guess. For anyone with a closing date on the calendar, the practical lesson is to understand the payment range you can live with before the next Fed meeting rather than after it.

This article is general news information, not financial, mortgage, tax or legal advice. Please consult a licensed mortgage professional, real estate attorney or tax adviser about your situation. Maison Pawli supports the Fair Housing Act and equal housing opportunity.

Sources

• AP via PBS NewsHour, “Fed chair Warsh says price stability is key but shies away from signals about rates” (Oct. 16, 2026): pbs.org
• AP via WPXI, “Average long-term US mortgage rate holds at 7.4%, remaining at highest level in nearly 3 years” (Oct. 15, 2026): wpxi.com
• AP via PBS NewsHour, “Wholesale inflation hits levels not seen since 2022” (Oct. 15, 2026), for the timing of the Fed’s next meeting: pbs.org
• Freddie Mac, “Mortgage Rates Hold Steady at 7.40%” (Oct. 15, 2026), company statement via GlobeNewswire: globenewswire.com