Mortgage rates are increasing in recent weeks despite the Federal Reserve's decision to cut interest rates last month for the first time in four years.
Americans saw mortgage rates soar during the Federal Reserve's aggressive campaign to fight inflation, leading many to hope for a reprieve after the central bank finally cut the federal funds rate last month for the first time in four years. But instead of declining, mortgage rates have marched higher for the past three weeks, with the benchmark 30-year fixed surging to 6.44% as of Freddie Mac's latest reading. Mortgage rates spiked in 2022 and 2023 as the Fed hiked interest rates.
" McBride noted that mortgage rates dropped a full percentage point between May and September from 7.2% to 6.2%, in expectation of coming Fed interest rate cuts. "The Fed’s more aggressive half-point rate cut in September increased the odds that the economy continues to grow, avoids recession, and that inflation could be higher than anticipated," he said.
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