Mortgage interest rates rise in week

Interest rates for 30-year, fixed-rate U.S. mortgages rose in the week ending June 11, the Federal Home Loan Mortgage Corp. said Thursday.

The 30-year, fixed-rate mortgage averaged 5.59 percent with an average 0.7 points in the week. In the previous week, 30-year, fixed-rate mortgages averaged 5.29 percent. A year ago, interest rates averaged 5.97 percent.

At 5.06 percent with an average 0.7 points, the 15-year, fixed-rate average also rose from the previous week’s average, which was 4.79 percent. A year ago, 15-year fixed-rate mortgages averaged 5.93 percent, Freddie Mac said.

Mortgage rates followed the increase in bond yields this week as the May employment report showed that the economy lost fewer jobs than the market consensus had expected, said Frank Nothaft, Freddie Mac vice president and chief economist.

Nothaft said the decline in the rate of U.S. jobs lost triggered a rise in federal funds futures, which signals that the market expects the Federal Reserve may raise its benchmark rate sooner rather than later.

Currently, higher mortgage rates are slowing refinancing activity but not demand for home purchases, he said.