Mortgage Rates Climb on Inflation Worries
Rates on 30-year mortgages increased to 6.37% from 6.3% last week, returning to levels seen a month ago. Rates on 15-year mortgages rose to 5.72%.
WASHINGTON — The average long-term U.S. mortgage rate rose again this week, reflecting ongoing bond market volatility as surging oil prices due to the war with Iran heighten inflation worries.
The benchmark 30-year fixed rate mortgage rate rose to 6.37% from 6.3% last week, mortgage buyer Freddie Mac said Thursday. That’s still down from one year ago, when the rate averaged 6.76%.
This is the second straight weekly increase, bringing the average rate back to where it was four weeks ago.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also moved higher this week. That average rate rose to 5.72% from 5.64% last week. A year ago, it was at 5.89%, Freddie Mac said.
Mortgage rates are influenced by several factors, from the Federal Reserve’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation.
The average rate on a 30-year home loan echoes the trajectory of U.S. 10-year Treasury bond yields, which lenders use as a guide to pricing home loans.
The 10-year Treasury yield was at 4.37% in midday trading Thursday on the bond market. The yield was at just 3.97% in late February, before the war with Iran broke out.
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