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LOS ANGELES -- The average long-term U.S. mortgage rate edged higher this
week, reflecting a recent uptick in the 10-year Treasury yield.

The average rate on a 30-year mortgage rose to 6.64% from 6.63% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged
6.12%.

“Mortgage rates remain stagnant, hovering in the mid-6% range over the
past several weeks,” said Sam Khater, Freddie Mac’s chief economist.

The move echoes an increase this week in the 10-year Treasury yield, which lenders use as a guide to pricing loans. The yield moved above 4% this
week as bond traders reacted to the government's January's jobs report .
The surprisingly strong report stoked worries that it could persuade the Federal Reserve to wait longer before it begins cutting interest rates.

Hopes for such cuts amid signs that inflation has declined from its peak
two summers ago have been a major reason the 10-year Treasury yield has
mostly pulled back since October, when it climbed to its highest level
since 2007.

In an interview broadcast Sunday night, Fed Chair Jerome Powell said that
the central bank remains on track to cut its benchmark interest rate three times this year, a move that economists expect could begin as early as
May.

Investors’ expectations for future inflation, global demand for U.S.
Treasurys and what the Fed does with interest rates can influence rates on
home loans.

The cost of refinancing a home got a little bit less expensive this week. Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, fell this week, pulling the average rate
down to 5.90% from 5.94% last week. A year ago it averaged 5.25%, Freddie
Mac said.

The cost of financing a home has been mostly easing since late October,
when the average rate on a 30-year mortgage hit 7.79%, the highest level
since late 2000. So far this year, the weekly average has ranged between
6.60% and 6.69%.

The overall decline in rates since their peak last fall has helped lower monthly mortgage payments, providing more financial breathing room for homebuyers facing rising prices and a shortage of homes for sale as the
spring homebuying season nears.

Still, the average rate on a 30-year mortgage remains sharply higher than
just two years ago, when it was 3.69%.

Many economists are projecting that mortgage rates will continue heading
lower this year, though forecasts generally have the average rate on a 30-
year home loan hovering around 6% by the end of the year.

“Homebuyers should expect mortgage rates to move lower as we head through
2024, but that does not necessarily mean it will be easier to buy a home,”
said Lisa Sturtevant, chief economist at Bright MLS. "Waiting to buy later
this year might mean a buyer can get a lower rate, but prices are still
rising and inventory will still be tight, which means the market will
still be competitive.”

Elevated mortgage rates and a dearth of available homes have kept the U.S. housing market mired in a slump the past two years. Sales of previously occupied U.S. homes sank to a nearly 30-year low last year, tumbling 18.7%
from 2022.

https://abcnews.go.com/Business/wireStory/average-long-term-us-mortgage- rate-edged-higher-107066172

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