Unfortunately May brought a disappointing jobs report for the U.S. and a speech by the Federal Reserve Chair Janet Yellen that seemed to take a June rate hike by the Fed’s rate-setting committee off the table, for now. This created a worrisome week for the U.S economy which led to lower rates for home loans.
Here is where the mortgage rates stand this week:
- The benchmark 30-year fixed-rate mortgage fell to 3.74% from 3.81%. The rate this week is 0.23 percentage points lower than the 52-week average.
- The benchmark 15-year fixed-rate mortgage fell to 3% from 3.05%.
- The benchmark 5/1 adjustable-rate mortgage fell to 3.13% from 3.22%.
- The benchmark 30-year fixed-rate jumbo mortgage fell to 3.71% from 3.76%.
Timing of Fed hike is less clear
As a result of the speech on Monday, the timing of when the Federal Reserve will decide to raise rates is still not clear. Yellen said the Fed would probably need to raise the federal funds rate gradually over time. That appeared to retract what was said in the speech 3 days earlier in which she said it would probably be appropriate to raise the funds rate “in a couple months”. The Federal Reserve will raise rates after our current uncertainties unfold.
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