Thursday, September 29, 2005

3-year mortgage rates rise to highest level in 5 months


Rates on 30-year mortgages jumped this week to the highest level in five months, reflecting financial market anxieties about inflation.

Mortgage giant Freddie Mac reported Thursday that the nationwide average for 30-year, fixed-rate mortgages rose this week to 5.91 percent, up from 5.80 percent last week. It was the third consecutive weekly increase and pushed the 30-year rate to its highest level since mid-April, when it was also 5.91 percent.

The increase followed the Federal Reserve's decision last week to boost a key short-term interest rate for an 11th time as central bank policy-makers focused more on the inflationary threats of rising oil prices than risks to economic growth from Hurricanes Katrina and Rita.