Worries about inflation pushed mortgage rates up this week, Freddie Mac reported today.
The average rate on 30-year fixed-rate loans jumped to 6.03 percent in the latest survey, up from 5.88 percent last week, while the average rate on 15-year fixed loans climbed from 5.4 percent to 5.62 percent. A year ago the 30-year averaged 6.16 percent and the 15-year averaged 5.87 percent.
To qualify for these rates, borrowers must pay points, or fees that lenders charge for loan processing expressed as a percent of the loan, which this week averaged 0.3 on the 30- and 15-year loans.
"Average rates on mortgages increased across the board this last week as the most recent economic data raised inflationary concerns in the capital markets," Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement. "For example, the Producer Price Index — a measure of wholesale inflation — increased 1.1 percent in March, nearly double the consensus expectations.
"March’s index of leading indicators showed a tepid increase of 0.1 percent, after five consecutive months of decline. As a result, trading of federal funds futures contracts implied a reduced likelihood of a substantial rate cut at the next Federal Open Market Committee meeting."
Average rates on adjustable-rate mortgages (ARMs) also rose this week, with the five-year Treasury-indexed hybrid ARM climbing to 5.68 percent from 5.48 percent a week ago and the average one-year ARM rate growing to 5.29 percent from 5.1 percent. Points paid on these loans averaged 0.5.
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