The central bank’s recent infusion of financial-market brawn includes Beth Hammack, who worked for three decades at Goldman Sachs.

Consumer Price Index showed an acceleration to 2.9%, the highest rate since July. With such high inflation, the Fed is unlikely to cut rates in January.

The yield on the 10-year Treasury has recently soared toward its highest level since 2023, injecting nervousness into the U.S. stock market that's knocked indexes from their records.

The US Federal Reserve could cut rates three or four times this year if inflation data cooperates, with a first cut possible before July, a senior bank official said Thursday.

As mentioned, mortgage rates haven't fallen in line with the Fed's rate cuts because they depend on factors beyond the agency's benchmark rate, such as the economy and 10-year Treasury bond yields. For example, when the 10-year treasury rate goes up, mortgage rates tend to follow, and vice-versa.

Federal Reserve Governor Christopher Waller said the US central bank could lower interest rates again in the first half of 2025 if inflation data continues to be favorable.

Due to the stronger-than-expected jobs report, Bank of America economists revised the Fed outlook for this year: “We no longer expect any additional rate cuts,” economists wrote in a report on Monday. "Inflation is stuck above target, with risks skewed to the upside, activity is strong, and the labor market now appears to have stabilized."

Inflation is proving stickier than expected, which could cause Fed to hit pause button on more interest rate cuts.

The Consumer Price Index rose 2.9 percent from a year earlier, but a measure of underlying inflation was more encouraging.

Traders of interest-rate futures are now predicting nearly equal chances on Wednesday that the Federal Reserve will lower interest rates twice by the end of this year, according to data compiled by Reuters.