In one of the most unpredictable periods for mortgage rates in recent history, the 30-year average took a 23 basis-point leap following an even bigger fall last week, Freddie Mac said, as investors react to a stream of seemingly contradictory economic news.
The 30-year fixed-rate average surged to 5.22% for the seven-day period ending August 11, according to Freddie Mac's Primary Mortgage Market Survey. The spike comes after the 30-year rate had dropped by over 50 basis points the prior two weeks, "a reminder that recent volatility remains persistent," said Sam Khater, Freddie Mac's chief economist, in a press release.
One week ago, the 30-year rate had
While interest rates dropped in late July and early August due to recession concerns and signs of potential implementation of
"Comments from Federal Reserve members early in the week started moving interest rates higher, as they messaged that there is still much work to be done in taming inflation," said Paul Thomas, vice president of capital markets at Zillow, in a research statement.
However, data released on Wednesday showed consumer prices moderating more than expected in July, with annualized inflation coming in at 8.5%. On a monthly basis,
"Jobs data late in the week was much stronger than market expectations, a signal that the Federal Reserve will likely need to continue aggressive actions to slow economic growth and reign in inflationary pressures," he said.
Further volatility is possible as markets try to determine the size of the next federal
As the 30-year average jumped, so did the 15-year fixed rate, which made a similar-sized move. The 15-year average rose 23 basis points to 4.59% from 4.26% seven days earlier. In the same week a year ago, it came in at 2.15%.
Meanwhile, the 5-year Treasury-indexed hybrid adjustable-rate mortgage also increased for the first time in five weeks, coming in at 4.43%. One week ago, the 5-year ARM had fallen to 4.25%, while last year, it stood at 2.44%.
