Fixed-mortgage rates reverse course, drop
Fixed-mortgage rates edged down this past week, with low and stable inflation pushing interest rates lower, Freddie Mac said in its latest Primary Mortgage Market Survey.
The 30-year, fixed-rate mortgage has remained under 4% for the past year and is braced to continue at this pace heading into the spring selling season, Freddie Mac suggested.
The 30-year, FRM came in at 3.54% in the most recent survey, down from 3.63% last week and 4.08% a year earlier.
The 15-year, FRM also declined to 2.72% from 2.79%, while falling from 3.30% last year.
The adjustable rates either slipped or remained the same, with the 5-year, Treasury-indexed hybrid adjustable-rate mortgage unchanged at 2.61%.
Meanwhile, the 1-year, Treasury-indexed ARM fell to 2.63%, down from 2.64% a week earlier and 2.84% last year.
"Low and stable inflation is placing downward pressure on fixed mortgage rates," said Frank Nothaft, vice president and chief economist with Freddie Mac.
"Annual growth in the consumer price index has remained at or below 2% for the past four months, and for the producer price index even lower," Nothaft added. "This, in part, is why the Federal Reserve monetary policy committee on March 20th lowered the upper end of its inflation forecast for 2013. In addition, our March outlook calls for 30-year fixed mortgage rates to remain below 4 percent throughout this year."