Mortgage rates climbed to their highest point in two months, reaching 6.83% for a 30-year fixed mortgage in the week ending April 17. This represents a significant one-week increase of 0.21%, the largest jump in nearly a year.
The increase is largely attributed to President Trump's tariff policies and their impact on the bond market. The escalating trade war with China has led to increased market volatility and a sell-off in US bonds. This volatility influenced the benchmark 10-year Treasury yield, which directly affects mortgage rates, spiking as high as 4.5% before settling around 4.3%.
Despite the rise, rates are still below the 7.1% seen last year. Freddie Mac's chief economist highlights that despite the rate increase, purchase application demand is 13% higher this year, indicating a robust start to the spring homebuying season.
CNN —
Springtime home shoppers may be feeling the impact of an intensifying trade war.
The average rate on a standard, 30-year fixed mortgage was 6.83% in the week ending April 17, up from 6.62% a week ago, mortgage financing provider Freddie Mac said Thursday.
That’s the largest one-week jump in mortgage rates in nearly a year.
Interest rates on home loans had been steadily falling since March, which may have encouraged some prospective buyers to enter the market at the start of peak homebuying season. But President Donald Trump’s scattered approach to tariffs and an escalating trade war with China has injected volatility into the stock market, and resulted in a sell-off in US bonds last week.
Mortgage rates track the benchmark US 10-year Treasury yield, which spiked as high as 4.5% last Wednesday. The 10-year has fallen slightly since then, trading at around 4.3% on Thursday.
The average 30-year fixed mortgage rate remains below the 7% level it had reached this time last year, though.
“At this time last year, rates reached 7.1% while purchase application demand was 13% lower than it is today, a clear sign that this year’s spring homebuying season is off to a stronger start,” said Sam Khater, Freddie Mac’s chief economist.
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