JPMorgan is reportedly laying off hundreds of employees in its mortgage arm, as steeper rates to tame inflation begin to cool the US housing market.

As per Bloomberg News, the move impacts over 1,000 employees in the US.

Of them, nearly 50% will be transferred to the lender’s other units, stated the publication citing people privy to the development.

A spokesperson of the US banking major said that the retrenchment exercise was driven by ‘cyclical changes’ in the mortgage space.

“We were able to proactively move many impacted employees to new roles within the firm, and are working to help the remaining affected employees find new employment within Chase and externally,” the spokesperson noted.

A similar culling and reallocation programme has also been initiated by Wells Fargo, Bloomberg reported citing people with knowledge of the matter.

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With home sales gradually curtailing, US real estate brokers Compass and Redfin too announced job cuts. The two plan to axe nearly 450 and 470 jobs, respectively.

Last month, the Federal Reserve increased benchmark interest rate by 75 basis points, which is its biggest hike since 1994. It also announced plans to keep increasing rates aggressively throughout this year.

The figure is expected to be increased to 3.4% by 2022-end, representing an upward revision of 1.5 percentage points from the March projection.

Soaring rates are weighing down on home sales, with median home price having crossed the $400,000 mark for the first time last month.

Meanwhile, at the end of last year, JPMorgan reportedly unveiled plans to make new hires for its retail bank Chase, with an aim of making it a pan-European lender.

The move is expected to take Chase’s staff strength to more than 1,000.