Mortgage interest rates rise slightly as investors eye inflationary concerns
Mortgage rates rose this week on inflationary and geopolitical concerns, Freddie Mac said in its latest Primary Mortgage Market Survey. The 30-year, fixed-rate mortgage increased to 4.81% for the week ending March 24 from 4.76% last week. That's still lower than the 4.99% recorded a year ago. Meanwhile, the 15-year, fixed-rate mortgage hit 4.04%, compared to 3.97% a week earlier and 4.34% a year ago. Freddie said the five-year, Treasury-indexed hybrid mortgage rate averaged 3.62%, up from 3.57% seven days prior and down from 4.14% last year. In addition, the one-year ARM climbed to 3.21% in the most recent survey, up from 3.17% last week. Frank Nothaft, Freddie Mac vice president and chief economist, outlined some of the inflationary pressures that buoyed mortgage rates. "The 12-month growth rate in the consumer price index rose 2.1% in February, compared to 1.6% in January; however, most of the increase was due to food and energy prices, which tend to be volatile. The core index rose 1.1%, slightly up from 1% in January," he said. Bankrate also released mortgage rate data Thursday, showing the 30-year FRM now sits at 4.96%, up from 4.91% a week earlier. The 15-year FRM inched up to 4.16% from 4.12%, and the 5/1 ARM rate hit 3.78%, up from 3.74%. "Mortgage rates increased, but only slightly, as investors digest world events and assess the potential impact on global economic recovery," Bankrate said. "The outlook for economic growth, inflation, and a desire to avoid market volatility are the key drivers of bond yields and mortgage rates on a day-to-day basis. Mortgage rates are closely related to yields on long-term government bonds." Write to Kerri Panchuk.