U.S. interest rates on 30-year mortgages rose to their highest level since mid-January, according to a report issued Thursday by mortgage finance company Freddie Mac.
U.S. 30-year mortgage rates rose to an average of 5.69 percent in the week ending Feb. 24 from 5.62 percent a week earlier. It was the highest level for 30-year mortgage rates since 5.74 percent in the week ended Jan. 13.
Fifteen-year mortgages also rose in the week to an average of 5.22 percent from 5.14 percent, and they were the highest since 5.23 percent in the final week of 2004.
One-year adjustable rate mortgages (ARM) averaged 4.16 percent, up slightly from 4.15 percent last week.
A year ago, 30-year mortgage rates averaged 5.58 percent, 15-year mortgages were 4.89 percent and the ARM was 3.50 percent.
“Mortgage rates moved up for the second week in a row on concerns about a pick up in inflation showing up in raw materials,” said Frank Nothaft, Freddie Mac vice president and chief economist, in a statement.
“However, a broader measure of inflation, the Consumer Price Index, posted a less than expected rise in inflation, causing bond yields to fall. This means that next week’s survey results may retreat to prior levels of a week or two ago,” he said.
The Labor Department on Wednesday said U.S. January consumer prices rose 0.1 percent. Prices excluding food and energy were up 0.2 percent.
On Friday the National Association of Realtors will issue U.S. January existing home sales data.
“Sales of existing homes in January are expected to be a little lower than they were in the previous months, but continuing low interest rates will keep the housing sector active for some time to come,” said Nothaft.
Freddie Mac said lenders charged an average of 0.7 percent in fees and points on 30- and 15-year mortgages, and 0.8 percent on the one-year ARM, all unchanged from last week.
Freddie Mac also said the hybrid “5/1” ARM, set at a fixed rate for five years, then adjustable each year following, averaged 5.05 percent, unchanged from last week.
Freddie Mac is a mortgage finance company chartered by Congress that buys mortgages from lenders and packages them into securities for investors or holds them in its own portfolio.
