Freddie Mac’s weekly primary market mortgage survey is out, and it shows rates (both long and short-term) reaching 10-month highs.

…the 30-year fixed-rate mortgage (FRM) averaged 6.53 percent with an average 0.4 point for the week ending June 7, 2007, up from last week when it averaged 6.42 percent. Last year at this time, the 30-year FRM averaged 6.62 percent. The 30-year FRM has not been higher since the week ending August 10, 2006, when it averaged 6.55 percent. The 15-year FRM this week averaged 6.22 percent with an average 0.4 point, up from last week when it averaged 6.12 percent. A year ago, the 15-year FRM averaged 6.23 percent. The 15-year FRM has not been higher since the week ending August 3, 2006, when it averaged 6.27 percent.

Freddie’s chief economist, Frank Nothaft, is usually spot-on in his analysis. This week was no different:

“Mortgage rates climbed this week owing to market concerns of a tight labor force and wage growth. May’s unemployment rate remained at the second lowest level since May 2001 while average hourly earnings rose,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Additionally, unit labor costs increased 1.8 percent over the first three months of the year, tripling the original estimate, and fueling inflation fears.”

When the spectre of inflation ebbs, as I suspect will happen in the latter part of this year, you’ll see mortgage rates ease up.