The average 30-year-fixed rate mortgage climbed to 3.56% during the week ending Jan. 20, rising from 3.45% the week prior, according to the latest Freddie Mac PMMS Mortgage Survey. A year ago, the 30-year fixed-rate mortgage averaged 2.77%. Most economists believe rates will continue to climb in the weeks and months ahead.
“Mortgage rates moved up again as the 10-year U.S. Treasury yield rose and financial markets adjusted to anticipated changes in monetary policy that will combat inflation,” Sam Khater, Freddie Mac’s chief economist, said in a statement.
The Federal Reserve announced in December that it is accelerating its tapering of bond-purchases starting in January. It is reducing the pace of its monthly purchases by $20 billion for Treasury securities and $10 billion for agency mortgage-backed securities. In November, the Fed started with a reduction of $10 billion for Treasury securities and $5 billion for agency mortgage-backed securities.
The rise in mortgage rates moved in concert with the 10-year Treasury yield, which reached 1.83% yesterday, compared to 1.67% on the previous Wednesday.
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