The average mortgage rate reversed course this week, with the average 30-year fixed-rate mortgage dipping to 6.89%, according to Freddie Mac. A week ago the rate averaged 6.95%.
The outlook is brightening for prospective home buyers because rates could ease even more because mortgage rates are tied to the yield on the Treasury’s 10-year bond. The latest economic data may have moved the needle.
"Following June’s jobs report, which showed a cooling labor market, the 10-year Treasury yield decreased this week and mortgage rates followed suit,” said Sam Khater, Freddie Mac’s chief economist. “We’re also seeing more inventory on the market, including a fair number of listings with price cuts, which is an encouraging sign for prospective buyers.”
Today’s Consumer Price Index for June, which fell for the first time since 2020, may help even more. Analysts say cooling inflation could trigger Federal Reserve rate cuts, which would likely push bond yields lower and lead to lower mortgage rates.
While the average 30-year fixed-rate mortgage is 6.89%, some lenders may be lower, so borrowers should check out several lenders.