We publish daily coverage of mortgage rate movements and have done so for nearly 20 years. It’s a great place to quickly check the rate trends and get a sense of what’s true and what matters. If you’ve checked at any point in the past few days/weeks, you’ve probably seen one of the many attempts to remind readers that not only did today’s Fed rate cut have absolutely no effect on lower mortgage rates, but that mortgage rates have often risen on the same day the Fed cuts.

That’s what happened today.

Interestingly enough, mortgage rates were already slightly higher than yesterday BEFORE the Fed announcement came out. The bonds that determine mortgage rates are actually pointing to even higher rates tomorrow, unless there is a significant improvement overnight.

Given the short attention span, here is a list of reasons why this paradox may exist:

• The Fed meets 8 times a year, while mortgages can change every day
• The bonds that affect mortgages can change at any second.
• That means mortgage rates had a long lead on lower rates as the Fed waited for the date of their meeting
• A trader would be foolish to hold a tradable rate/bond in higher territory if they knew as well as you did that the Fed was cutting rates today. Why would they wait to cut mortgage rates? There was nothing stopping them and that is why rates have fallen so much in recent months.

Some other bullet point angles on the same topic:

• The actual Fed rate cut itself is only one part of the Fed day and usually not the most important part
• The Fed also publishes a member interest rate outlook at every other meeting. Today’s meeting was one of those
• The Fed will also hold a press conference following the announcement, where the Fed chairman can explain the market’s conclusions and help shape expectations going forward.

In short, Fed Chairman Powell’s press conference was less favorable for rates than one might expect given the 0.50% cut in the Fed Funds Rate.

Here’s the thing: nothing today means much for the path of interest rates going forward. There’s probably a slightly higher risk that the recent low rates will form some sort of bottom until economic data shows rates need to come down, but there’s NEVER any way to know exactly what rates will do in the future. If you don’t believe that after today, well… just believe it.