The Fed Is Cutting - Why Are Mortgage Rates Going Up?

2025-01-01 10:20:00 ET

Summary

• Powell is admitting that inflation is still too high, but the Fed still plans to cut interest rates by .25%. So why are mortgage rates going up?
• Although it’s continuing to cut, the Fed’s actions primarily influence short-term interest rates, such as the federal funds rate.
• However, most mortgage rates, particularly those for fixed-rate loans, are more closely tied to long-term bond yields, such as the yield on 10-year U.S. Treasuries. And right now, 10-year Treasury yields are soaring.

Originally published on December 25, 2024

Powell is admitting that inflation is still too high, but the Fed still plans to cut interest rates by .25%. So why are mortgage rates going up ?...

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