Mortgage rates tick higher for first time in weeks

Mortgage rates ticked higher for the first time in weeks, mortgage buyer Freddie Mac said Thursday.

Freddie Mac’s latest Primary Mortgage Market Survey, released Thursday, showed that the average rate on the benchmark 30-year fixed mortgage rose to 6.72% from last week’s reading of 6.67%.

The average rate on a 30-year loan was 6.89% a year ago.

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“After declining for five consecutive weeks, the 30-year fixed-rate mortgage moved slightly higher following a stronger than expected jobs report,” said Sam Khater, Freddie Mac’s chief economist. “Despite ongoing affordability challenges in the housing market, we are seeing home purchase and refinance applications respond to the downward trajectory in rates, increasing by 25% and 56%, respectively, compared to the same time last year.”

The average rate on the 15-year fixed mortgage climbed to 5.86% from last week’s reading of 5.8%. One year ago, the rate on the 15-year fixed note averaged 6.17%.

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The Labor Department on Thursday reported that employers added 147,000 jobs in June. That figure was above the estimate of economists polled by LSEG, who projected 110,000 jobs would be added.

The unemployment rate ticked down slightly to 4.1%, which was lower than economists’ expectations of 4.3%.

The market viewed the June jobs report as solidifying the outlook for the Federal Reserve to leave interest rates unchanged for its fifth consecutive meeting later this month. 

The probability of a 25-basis-point interest rate cut in July declined from 23.8% a day ago to 6.7% on Thursday following the report’s release, according to the CME FedWatch tool.