Mortgage Rates Rise Despite Lower Inflation, Driven by Treasury Yields

Mortgage rates experienced a modest increase in recent days, with the average rate for a 30-year fixed-rate mortgage rising to 6.853% as of March 13, 2025. This increase of 0.029 percentage points from the previous day was accompanied by a similar rise in the 15-year fixed-rate loan, which averaged 6.234%, up by 0.056 percentage points. These adjustments occurred despite lower-than-expected inflation data, which had initially alleviated concerns about economic slowdown. However, the rise in Treasury yields contributed to the upward movement in mortgage rates.

Freddie Mac's benchmark rate survey for the week ending March 13, 2025, indicated that the average rate for a 30-year fixed-rate mortgage increased to 6.65%, a slight rise of 0.02 percentage points. The rate for a 15-year fixed-rate mortgage also saw an increase to 5.80%, up by 0.01 percentage points. This marks the first increase in Freddie Mac's benchmark rate in the past two months, although the 30-year rate remains lower than it was during the same week a year ago.

The current average refinance rate for a 30-year, fixed-rate home loan stands at 6.33%, according to data from a popular real estate marketplace. This rate reflects the cost for homeowners looking to refinance their loans to secure lower interest rates or modify their loan terms. Refinance rates are typically higher than purchase rates, so homeowners should carefully weigh the benefits and drawbacks before deciding to refinance.

The recent downward trend in mortgage rates has been viewed positively by prospective buyers waiting to enter the market. For those feeling financially secure and ready to purchase, the dip in mortgage rates presents an encouraging opportunity. However, concerns about the health of the U.S. economy and the potential for a recession have kept mortgage rate movements relatively stable in recent weeks. The consumer price index, released on Wednesday, showed that inflation was lower than expected in February, providing some relief amidst uncertainty over the impact of tariffs on future price growth. Despite this positive news, inflation remains above the Federal Reserve's target range of 2%.