Mortgage Rates Inch Higher on Economic News
WASHINGTON – Rates on 30-year mortgages edged up slightly this week, reflecting market worries about inflation.
Mortgage-giant Freddie Mac (FRE) reported Thursday that 30-year, fixed-rate mortgages rose to 6.33 percent, up from 6.31 percent last week. Rates have exhibited a seesaw pattern of falling one week and then rising the next week for the past 1 1/2 months.
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Analysts attributed the latest increase to last week's unemployment report, which raised worries in financial markets about inflation pressures coming from a tight labor market with a jobless rate at 4.4 percent.
"Mortgage rates rose earlier in the week on news of large upward revisions over the past three months in employment figures, but began to drift lower as the market looked more deeply into the numbers," said Frank Nothaft, chief economist at Freddie Mac.
On closer inspection, Nothaft said, the jobs report showed weakness in a variety of industries such as construction, which has been hurt by the slump in housing.
Nothaft said that he was looking for the economy, which grew at a sluggish rate of 1.6 percent in the July-September quarter, to rebound in the final three months of this year with the strength coming from areas outside of housing.
The big slump in housing, after five record sales years, trimmed economic growth by more than 1 percentage point in the third quarter.
The Freddie Mac mortgage survey showed that rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, averaged 6.04 percent this week, up from 6.02 percent last week.
Rates on one-year adjustable rate mortgages edged up to 5.55 percent, compared to 5.53 percent last week.
Five-year adjustable rate mortgages rose to 6.08 percent, up from 6.05 percent last week.
The mortgage rates do not include add-on fees known as points. The 30-year and 15-year mortgages each carried an average nationwide fee of 0.6 point. The one-year ARM had a nationwide average fee of 0.8 point and the five-year ARM had an average fee of 0.7 point.
A year ago, 30-year mortgages averaged 6.36 percent while 15-year mortgages stood at 5.89 percent, one-year ARMs were at 5.12 percent and five-year ARMs were at 5.81 percent.