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UPDATE 1-U.S. 30-year mortgage rates highest since December - Freddie Mac
March 9, 2017 / 5:40 PM / 9 months ago

UPDATE 1-U.S. 30-year mortgage rates highest since December - Freddie Mac

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    NEW YORK, March 9 (Reuters) - U.S. 30-year mortgage rates
rose to their highest since late December, in line with a spike
in Treasury yields, due to growing expectations the Federal
Reserve will raise interest rates next week, according to
Freddie Mac on Thursday.
    The borrowing cost on 30-year mortgages, the most widely
held type of U.S. home loan, averaged 4.21 percent in the week
ended March 9. That was the highest since 4.32 percent in the
week ended Dec. 29 and above 4.10 percent the previous week, the
mortgage finance agency said. 
    The benchmark 10-year Treasury yield rose more than 17 basis
points last week as a group of Fed officials, including Chair
Janet Yellen, signaled a high likelihood the U.S. central bank
will raise interest rates at its policy meeting next week, on
signs of an improving U.S. economy.
    The yield on 10-year Treasuries reached about an 11-week
high on Thursday at 2.589 percent, Reuters data showed.

    The jump in mortgage rates has not stymied application
activity for home purchases or to refinance a home loan. 
    On Wednesday, the Mortgage Bankers Association said its
gauge on U.S. mortgage applications climbed its strongest level
since mid-December.
    Investors were waiting to see whether the government's jobs
report for February, due for release at 8:30 a.m. (1330 GMT) on
Friday, will show more hiring and wage growth, providing the
latest evidence for the Fed to lift rates since December.
    "The strength of Friday's employment report and the outcome
of next week's (Federal Open Market Committee) meeting are
likely to set the direction of next week's survey rate," Freddie
Mac chief economist Sean Becketti said in a statement.  
    Analysts polled by Reuters forecast U.S. employers likely
added 190,000 workers last month, less than January's 227,000
increase. They projected average hourly earnings likely grew by
0.3 percent, rebounding from a 0.3 percent decline in January.  
   Below is a summary of Freddie Mac's average mortgage rates in
the week ended March 9:
 Loan type      Latest week (pct)  Week ago (pct)  Year ago (pct)
 30-year fixed  4.21               4.10            3.68
 15-year fixed  3.42               3.32            2.96
 5-year ARM     3.23               3.14            2.92

 (Reporting by Richard Leong; Editing by Bernadette Baum)

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