Mortgage Rates Move Higher After 6-Week Decline
A 30-year, fixed-rate mortgage averaged 2.87% this week, up from 2.77%. Pandemic fears that pushed rates down were boosted by positive employment numbers this week.
Mortgage rates rose this week for the first time after six weeks of declines amid signs of strong economic recovery.
Average rates for home loans remain historically low, however, at under 3%.
Mortgage buyer Freddie Mac reported Thursday that the average for the 30-year mortgage jumped to 2.87% from 2.77% last week. The benchmark rate, which reached a peak this year of 3.18% in April, stood at 2.96% a year ago.
The rate for a 15-year loan, a popular option among homeowners refinancing their mortgages, increased to 2.15% from 2.10%.
Uncertainty over the fast-spreading delta coronavirus variant and its potential effect on the economic recovery had been a backdrop in recent weeks suppressing mortgage rates.
Last Friday, the government reported that U.S employers added 943,000 jobs in July and drove the unemployment rate down to 5.4%. That was another sign that the economy is bouncing back with surprising vigor from COVID-19, and it appeared to provide a lift to mortgage rates.
Still, there is growing fear that the delta variant will set back the recovery. The worry is that the resurgent virus could discourage people from going out and spending, and trigger another round of shutdowns or other restrictions.
The Labor Department collected its data for the employment report in mid-July before the Centers for Disease Control and Prevention reversed course and recommended that even vaccinated people resume wearing masks indoors in places where the variant is pushing infections higher.
In a fresh indication, a new government report Thursday showed that the number of Americans seeking unemployment benefits fell for the third consecutive week as employers struggle to fill a record number of open jobs and meet a surge in consumer demand. Jobless claims fell to 375,000 from 387,000 the previous week.