After the Fed cuts interest rates, the direction of US mortgage rates becomes a mystery.

After the Federal Reserve lowered the benchmark interest rate on Wednesday, mortgage rates quietly rose - a phenomenon that, though counterintuitive, is quite common. According to data from Zillow, as of Wednesday, mortgage rates remained at 6.26%, the lowest level since early October 2024. However, most of Zillow's data was collected before the Fed cut rates. Federal Reserve Chairman Powell said on Wednesday, "We do not set mortgage rates, but our policy rate changes often have an impact on them. This impact has already been seen, and of course, it will boost demand." The future direction of mortgage rates is still uncertain. Despite the Fed cutting rates three times from September to December last year, mortgage rates continued to rise during the same period. Data released on Wednesday showed that Fed officials expect two more rate cuts this year, but they still have differing views on the short-term economic outlook. Zillow's senior economist Orphe Divounguy stated in a declaration, "Due to the potentially faster pace of monetary policy easing in the financial markets expected compared to the steps actually taken by the Fed, mortgage rates are unlikely to decrease significantly further."