Mortgage Sector Surges as Fed Policy Shift Sparks Rally

The Federal Reserve’s pivotal decision to cut interest rates for the first time since December has ignited a powerful rally across the mortgage sector, with PennyMac Services emerging as a primary beneficiary. The company’s shares soared to unprecedented levels following the announcement, prompting investors to question whether this record-setting performance is sustainable.

In a widely anticipated move, the Federal Reserve reduced the benchmark interest rate by 25 basis points to a range of 4.00-4.25 percent. Policymakers cited initial signs of labor market softening as justification for the adjustment, despite inflation metrics remaining above target levels.

This monetary policy shift has immediately impacted the housing finance landscape. Average rates for 30-year fixed mortgages dropped below 6.5 percent for... Read more...