Mortgage rates in the US inched higher amid signals that the Federal Reserve is likely to keep its policy steady for some time.
The average for a 30-year, fixed loan was 6.64%, up from 6.63% last week, Freddie Mac said in a statement Thursday.
Borrowing costs have been hovering close to 6.6% after falling from a peak of 7.79% in late October. That decline has pushed more buyers into the market, with a gauge of US existing-home contracts rebounding sharply in December and a measure of mortgage applications ticking up in recent weeks.
US Treasury yields have climbed as Federal Reserve policymakers suggested they’re not in a rush to cut interest rates. Chair Jerome Powell said earlier this week that the central bank’s job taming inflation is “not quite done” and consumers may have to wait beyond March for the first reduction.
“The economy and labor market remain strong with wage growth outpacing inflation, which is keeping consumer spending robust,” Sam Khater, Freddie Mac’s chief economist, said in the statement. “Meanwhile, affordability in the housing market is an ongoing issue due to continued high home prices, elevated mortgage rates and low supply of homes on the market, particularly for first-time and low-income homebuyers.”
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