Ahead of the Federal Reserve’s rate cut, mortgage rates had fallen tantalizingly close to what some considered the “magic number” of 6% that would revive a stagnant housing market marked by low inventory and the lock-in effect.

Since the central bank unveiled that long-anticipated cut last month, however, mortgage rates have actually climbed along with long-term Treasury yields.

To be sure, Fed cuts don’t mean mortgage rates suddenly drop, as the latter follow the expected path of policymakers rather than their actual moves.

But in recent weeks, Fed officials and economic data have dampened hopes for an aggressive monetary easing cycle.

First, when the Fed cut rates, it also released officials’ economic projections that included the so-called dot plot of where they see rates heading. That tilted toward slightly less easing than the market anticipated.

Then, during his subsequent news conference, Fed Chairman Jerome Powell said the jumbo half-point cut wasn’t necessarily indicative of the pace of future cuts, adding that policy would remain data-dependent.

And a week after that, Powell cautioned that Fed officials are in no hurry to cut rates further. Finally, Friday’s blockbuster jobs report pointed to a still-robust economy that needs of plenty of workers who are demanding higher wages.

Wall Street analysts slashed their forecasts on Fed rate cuts, and the 10-year yield soared 12 basis points to 3.971%. The data was such a shock, some prognosticators even said the Fed would have to pause on cutting rates to avoid reaccelerating inflation.

Mortgage rates have followed Treasury yields higher. According to Mortgage News Daily, the average 30-year fixed rate shot up 27 basis points in Friday alone to 6.53%, which is also 42 basis points higher than Sept. 17—right before the Fed cut rates.

In a statement after the jobs report, the Mortgage Bankers Association’s chief economist, Michael Fratantoni, warned the data could slow the expected pace of Fed rate cuts as inflation may not continue cooling in a straight line.

“MBA’s forecast is for longer-term rates, including mortgage rates, to remain within a relatively narrow range over the next year,” he added. “This news will push mortgage rates to the top of that range, but we do expect that mortgage rates will stay close to 6% over the next 12 months.”

Even before the jobs report, other housing market forecasts weren’t very sanguine on activity and mortgage rates.

Days after the Fed meeting, mortgage giant Freddie Mac released its monthly outlook, which predicted mortgages rates would decline further, but remain above 6% by year-end.

While demand should rise, sales won’t get much of a boost as affordability will only improve modestly while the lock-in effect will continue weighing on inventory.

“Unless rates fall significantly—something in the order of a full percentage point or more—we do not expect inventory of existing homes to come on the market in large numbers, limiting supply,” Freddie Mac said. “We expect home sales to remain muted in 2024 and 2025.”