Why didn't mortgage rates fall after the Federal Reserve rate cut?

Core Insights - The Federal Reserve's actions to lower short-term interest rates do not always correlate with a decrease in mortgage rates, which are influenced by long-term economic factors [1][5]. Group 1: Federal Reserve Actions - The Federal Reserve cut the federal funds rate by a quarter-point on September 17, 2025, but mortgage rates increased shortly after [2][4]. - Mortgage rates are tied to longer-term benchmarks, such as the 10-year Treasury, rather than directly to the Fed's short-term rate adjustments [3][5]. Group 2: Mortgage Rate Dynamics - Following the Fed's rate cut, 30-year fixed mortgage rates dropped from 6.89% to 6.26% before rising again to 6.30% after the cut [4]. - The bond market's reaction to macroeconomic trends, such as inflation and employment, plays a significant role in determining mortgage rates [3][5]. Group 3: Economic Influences - For mortgage rates to trend downward, softer labor or inflation data is necessary to support lower yields [5]. - The overall economic environment, rather than the Fed's actions alone, is crucial in influencing mortgage rates [5].