Mortgage rates jumped this week, according to Freddie Mac's weekly survey. "Average rates on mortgages increased across the board this last week as the most recent economic data raised inflationary concerns in the capital markets," said Frank Nothaft, Freddie Mac vice president and chief economist. This reduced the expectations of a cut in the Fed Funds rate to 25 basis points at next week's Federal Open Market Committee meeting from 50 basis points expected prior to the news.
On the fixed rate side, 30-year rates rose 15 basis points to 6.03%. Rates were last above 6% during the week ending March 14 when it hit 6.13%. For this year, the highest 30-year mortgage rates have been is 6.24% in late February. The 15-year mortgage rates surged 22 basis points to 5.62%.
On the adjustable side, five-year hybrid ARM rates averaged 5.68% compared to 5.48% in last week's survey. One-year ARM rates increased to 5.29% from 5.10%.
Given the higher rates, mortgage application activity is expected to have stalled this week. Yesterday, the Mortgage Bankers Association reported its Refinance Index fell 20% to 2286 for the week ending April 11. This is the lowest level the index has been this year.