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When the Fed lowers interest rates, borrowing money becomes cheaper, which usually helps the economy. However, sometimes interest rates outside of the Fedās rate still rise because people are worried about inflation (prices rising) or expect the economy to grow faster. This can lead investors to seek higher returns on assets like bonds, which in turn causes overall interest rates to increase even after the Fed cuts rates.
For a great explanation, check out Amanda Rea, Senior Loan Officer @ Guild Mortgage in the link below:
Mortgage Rates vs Fed Rates Explained
