Mortgage Rates Head Back Over 7% After Powell Testimony

Mortgage Rates Head Back Over 7% After Powell Testimony

Jerome Powell is the Chair of the Federal Reserve--the entity that sets overnight lending rates in an attempt to keep inflation in a low, stable range.  Inflation has been anything but low and stable recently, so the Fed has hiked overnight rates at the fastest pace in 40 years. Mortgage rates have also risen at the fastest pace in 40 years, but they are not directly dictated by the Fed.  Rather, the Fed's direct influence on overnight rates spills over to the rest of the rate market.  The longer the duration of any given borrowing term, the less connected the interest rate may be to the Fed Funds Rate. Moreover, the market adjusts expectations for the Fed Funds Rate constantly whereas the Fed only officially hikes/cuts 8 times a year.  When the Fed meets again in 2 weeks, they wi