By ALEX VEIGA, AP Business Writer
The average rate on a 30-year U.S. mortgage edged lower this week, staying relatively close to its low for the year.
The decline brings the average long-term mortgage rate to 6.21% from 6.22% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.72%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell this week. The rate averaged 5.47%, down from 5.54% last week. A year ago, it averaged 5.92%, Freddie Mac said.
Mortgage rates are influenced by several factors, from the Federal Reserve’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation. They generally follow the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
The 10-year yield was at 4.12% at midday Thursday, unchanged from a week ago.
The average rate on a 30-year mortgage has been mostly holding steady in recent weeks since it dropped to 6.17%, its lowest level in more than a year, on Oct. 30.
Mortgage rates began easing in July in anticipation of a series of Fed rate cuts, which began in September and continued this month. An encouraging report on inflation on Thursday could give the central bank cause to keep cutting interest rates next year.
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