A ceasefire won’t reset mortgage rates — inflation and energy prices will

Mortgage rates are likely to remain volatile as long as uncertainty persists around energy prices and inflation. The 30-year fixed rate dropped from 6.44% to 6.38% on April 8, a move tied directly to the two-week ceasefire between the U.S. and Iran, with no other economic data released that day. But the reprieve may be short-lived. Treasury yields still reflect skepticism about a durable resolution in the Strait of Hormuz, and gas prices — which surged at the onset of hostilities — are expected to take weeks to recede meaningfully. Higher energy costs feed directly into inflation, and with March’s annual inflation forecast at 3.3%, up from 2.4% in February, pressure on mortgage rates remains. Elevated inflation expectations tend to push borrowing costs higher, counteracting any relief from geopolitical de-escalation. Real estate economists at Redfin and Bright MLS warn that the housing market faces more headwinds than tailwinds, with affordability and economic uncertainty still dominant. Zillow estimates that if the energy shock extends through 2026, existing home sales will fall 0.73% year-over-year — a sign that prolonged volatility could dampen transaction volume even as pent-up demand provides some support. A ceasefire alone does not reset mortgage rates. Inflation and energy prices do.