Mortgage rates increase slightly as geopolitical upheaval could expand Americans’ home-buying power
Mortgage rates edged up slightly over the last week amid continued uncertainty about the state of global affairs.
The 30-year fixed-rate mortgage averaged 3.65% during the week ending Jan. 16, up a single basis point from the previous week when rates dropped as a result of growing tensions between the U.S. and Iran, Freddie Mac FMCC, -0.17% reported Thursday.
The 15-year fixed-rate mortgage increased two basis points to an average of 3.09%, according to Freddie Mac. The 5-year Treasury-indexed hybrid adjustable mortgage averaged 3.39%, rising nine basis points from a week ago.
The direction of mortgage rates tends to reflect movement in the 10-year Treasury yield. Before this past week, investors had rushed to purchase Treasury notes as a precautionary measure when it looked likely that a conflict could emerge between the U.S. and Iran. As a result, the yield on these notes fell, causing mortgage rates to drop to their lowest levels in a month.
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But this week, the yield on the 10-year Treasury noted improved somewhat as tensions in the Middle East abated and the U.S. and China signed the first phase of their trade deal. While an improvement, the investor response nevertheless was somewhat muted, said Zillow ZG, +2.15% economist Matthew Speakman.
“Wednesday’s signing of an initial trade deal between China and the U.S.— a major development in what has been the most impactful ...
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