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Why can mortgage rates change after a Federal Reserve announcement?

A straight answer to a real question.

The Federal Reserve controls a short-term policy rate, not consumer mortgage rates directly. Mortgage rates are influenced more heavily by longer-term bond markets and mortgage-backed securities.

Investors react to the Fed’s decision, economic projections, inflation outlook, employment risks, government borrowing, and the chair’s comments. That is why mortgage rates can fall, rise, or reverse direction after a Fed announcement even when the policy rate moves the way markets expected.