The average rate on a 30-year U.S. mortgage rose to 6.34%, up from 6.3% last week, according to Freddie Mac. Rates had been declining but are now influenced by the Federal Reserve’s policies and economic indicators, with the 10-year Treasury yield at 4.10%.

Mortgage rates began declining ahead of the Fed’s interest rate cut last month, but have since risen. Fed Chair Jerome Powell has signaled caution on future cuts, contrasting with other members pushing for faster reductions. The housing market has been in a slump, with sales of U.S. homes at a 30-year low.

The increase in mortgage rates could follow last year’s trend after a Fed rate cut led to rising rates. Despite more rate cuts ahead, mortgage rates may not continue to decline. However, the recent drop has prompted many homeowners to refinance at lower rates, with refinancing becoming attractive below 6%.

81% of U.S. homes have mortgages with rates at 6% or lower, making it crucial for rates to drop below that threshold for more homeowners to consider refinancing. The Fed’s rate cut does not guarantee further declines in mortgage rates, emphasizing the importance of monitoring economic trends and indicators.

Read more at Yahoo Finance: Average long-term US mortgage rate ticks up for second straight week, to 6.34%