Mortgage Rates Jump To 3-Month High: Freddie Mac
Mortgage rates jumped higher this week, marking the third consecutive week of increases.
According to Freddie Mac's benchmark survey, the average rate on a 30-year fixed-rate mortgage increased to 6.79%, a change of 0.22 percentage points from a week ago.
The average rate on a 15-year fixed-rate loan also climbed higher, moving up to 6.18%, a change of 0.21 percentage points from the week prior.
The recent uptick in rates has been a result of better-than-expected economic news, inflation that remains stubbornly high and fears over a potential default by the U.S. government.
Rates soar as economic uncertainty reigns
There are signs that the economy is not cooling as fast as the Federal Reserve would like.
The labor market remains stronger than expected: According to payroll processing firm ADP, the economy added 278,000 new jobs in May, almost 100,000 more than economists predicted.
At the same time, the personal consumption expenditures price index, also known as core inflation, increased by 0.4% month-over-month in April, which is also higher than expected. Compared to last April, core inflation increased to 4.7%, also above analyst estimates.
All these signs point to the likelihood that the Federal Reserve will continue raising the federal fund rate to force consumer prices lower.
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