US Mortgage Rates Climb Amid Economic Concerns

U.S. mortgage rates have risen for the third consecutive week, reaching their highest level since early August, with the average 30-year fixed-rate mortgage now around 6.52% according to the Mortgage Bankers Association. This increase comes despite the Federal Reserve's recent interest rate cut, as mortgage rates are more closely aligned with the 10-year Treasury bond yields, which have been increasing. Factors such as a stronger-than-expected U.S. economy and inflation concerns are contributing to the rising rates. The current rates are a stark contrast to the lows seen during the pandemic, impacting potential homebuyers who were hoping for relief. Analysts suggest that rates might stabilize but are unlikely to drop significantly in the near term. The rising rates have dampened mortgage applications, which fell by 17% last week compared to the prior week.