Last week the Federal Reserve cut its Fed Fund Rate by 25 basis points. The Fed Funds Rate is not directly tied to mortgage rates. Instead, markets react more to the signaling of the cut and the comments made by the Fed at the press conference.
On September 17th, following the Fed’s policy change of the rate cut the Bond market increased by almost 20bp signaling better mortgage rates. But during the press conference, Fed Chair Powell stressed that cuts are not a preset plan and will be decided meeting by meeting based on data. His comments reversed the earlier bond gains, pushing rates higher.
As a result, many lenders adjusted pricing midday, pushing mortgage rates higher. This is why working with a true mortgage advisor who is in tune with market trends is key to helping you to make the best decisions through your loan process.
Source : https://bit.ly/47QmnBA
By: Jon Iacono