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Rates On 30-Year Mortgages Increase Again To 6.45%

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The Associated Press

Published: June 27, 2008

WASHINGTON - Rates on 30-year mortgages rose again this week, climbing to the highest level in more than nine months, reflecting more concerns about how the Federal Reserve will respond to higher inflation pressures.

Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages averaged 6.45 percent this week. That was up from 6.42 percent last week.

It was the highest level for 30-year mortgages since they averaged 6.46 percent for the week of Sept. 9. It marked the fifth consecutive weekly increase and the fifth week that they have been above 6 percent.

Rates on 15-year, fixed-rate mortgages rose to 6.04 percent, up from 6.02 percent last week.

Frank Nothaft, chief economist at Freddie Mac, said financial markets are uncertain about what the Fed will do in response to rising inflation pressures. On Wednesday, the central bank brought its aggressive campaign of interest rate cuts to a halt, leaving the federal funds rate unchanged at 2 percent.
Fed officials expressed heightened concern about inflation and signaled that their next move would likely be a rate increase.

A year ago, rates on 30-year mortgages stood at 6.67 percent and 15-year mortgage rates averaged 6.34 percent.

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