**Mortgage Rates Surge Following Employment Report Release**

The average rate on the 30-year fixed mortgage has surged to 6.53%, as reported by Mortgage News Daily. This increase marks a significant rise of 42 basis points compared to the rate on September 17, the day prior to the Federal Reserve's half a percentage point cut in its benchmark rate.

Following the release of the government's monthly employment report, the average rate saw a notable jump of 27 basis points. Unlike the Federal Reserve’s benchmarks, mortgage rates are more aligned with the yields on the 10-year U.S. Treasury, reflecting market expectations of future moves by the Fed.

Matthew Graham, COO at Mortgage News Daily, noted that the Fed's recent larger-than-expected rate cut aimed to counter fears of economic data pointing to weaker labor market conditions. There had been much anticipation for the current employment report due to the preceding months indicating a softer job market.

Michael Fratantoni, Chief Economist at the Mortgage Bankers Association, projected that mortgage rates would stay within a narrow range over the coming year. However, the latest employment data has nudged rates to the upper boundary of that forecasted range, with an expectation to hover near 6% over the next 12 months.

The housing market continues to grapple with high sensitivity to interest rate fluctuations, coupled with rising home prices and persistently low inventory levels. Although the current mortgage rates are a full percentage point lower than a year ago, the anticipated boost in the housing market remains elusive.