Mortgage rates rose to their highest level in a year amid the re-escalating conflict with Iran and investors grew more worried about the Federal Reserve’s plans to tame inflation.
The average 30-year mortgage rate rose 8 basis points to 6.66% this week through Wednesday, according to Freddie Mac data, hitting its highest level since the end of July 2025.
Rates are likely to go higher from here. Government bond yields, which mortgage rates closely track, surged on Wednesday after the Federal Reserve opted to hold short-term interest rates steady, with three voting members supporting a hike.
Bond investors, worried about the Fed’s commitment to taming inflation, sold off long-term Treasuries, sending the 30-year Treasury yield to its highest level in nearly two decades. The 10-year Treasury yield, which has the closest relationship with mortgage rates, jumped more than 4 basis points on Thursday to 4.67%.
Claire Boston | Yahoo Finance