Fed’s rate cut won’t directly affect mortgage rates

A look at mortgage rates must begin with a history lesson. From Jan. 3, 2001, to June 25, 2003, the Federal Reserve reduced its target for the federal funds rate 13 times. Here’s what happened to the average 30-year mortgage rate in the month after each cut: It fell eight times and rose five times. It’s simply not true that a Fed rate cut automatically leads to a drop in fixed mortgage rates.

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