Mortgage rates rose again this week on word that economic growth picked up in the first quarter and inflation is on the rise, according to surveys conducted by Freddie Mac and Bankrate.com.

In Freddie Mac’s survey, the 30-year fixed-rate mortgage climbed to an average 6.43 percent for the week ended today, up from last week’s average of 6.35 percent. The average for the 15-year fixed-rate loan is 6.1 percent, up from last week’s average of 6 percent. Points on the 30- and 15-year averaged 0.6 and 0.5, respectively.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 6.11 percent this week, with an average 0.6 point, up from last week when it averaged 6.02 percent, Freddie Mac reported. The one-year Treasury-indexed ARM averaged 5.57 percent, with an average 0.7 point, up from last week when it averaged 5.51 percent.

“In the first quarter of 2006, it appears that economic growth picked up relative to the last three months of 2005. There is concern that the continued high level of energy cost may lead to inflation in other sectors of the economy,” said Frank Nothaft, Freddie Mac vice president and chief economist. “And fear of inflation leads to higher mortgage rates, like the ones we see this week.

“Our forecast for the year as a whole is for economic growth of 3.8 percent in 2006, above the 3.2 percent in 2005, which may warrant even more Fed rate hikes than previously expected. If that is the case, mortgage rates may continue their gradual upward trend.”

In Bankrate.com’s survey, fixed mortgage rates climbed again, with the average 30-year fixed rate mortgage rising to 6.51 percent. This is the highest since the week of July 17, 2002. The 30-year fixed-rate mortgages in this week’s survey had an average of 0.32 discount and origination points.

The average 15-year fixed-rate mortgage, popular for refinancing, stepped up to 6.17 percent, and the average jumbo 30-year fixed rate jumped from 6.64 percent to 6.68 percent, according to Bankrate.com. Adjustable-rate mortgages also staged increases, with the average 5/1 adjustable-rate mortgage rising from 6.13 percent to 6.17 percent, and the average one-year ARM notching higher from 5.77 percent to 5.83 percent.

Bankrate.com reported that mortgage rates hit the highest point in nearly four years as bond investors come to grips with the idea that short-term interest rates are headed even higher and the economy is still firing on all cylinders. In addition, an inflation gauge often used by the Fed showed a strong advance during the fourth quarter of 2005, rising at a 3.5 percent annualized pace. This is not the type of news that will get the Fed to stop raising interest rates, according to Bankrate.com. As a result, with the overnight cost of borrowing headed to 5 percent in May, the cost of borrowing for 10 or more years is also re-pricing higher. Fixed mortgage rates are closely related to yields on long-term government bonds. Still, the difference between short-term and long-term interest rates is very scant, meaning home shoppers are likely to see continued increases in coming months.

The following is a sampling of Bankrate.com’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas:

New York – 6.45 percent with 0.2 point

Los Angeles – 6.55 percent with 0.39 point

Chicago – 6.65 percent with 0.06 point

San Francisco – 6.59 percent with 0.22 point

Philadelphia – 6.42 percent with 0.4 point

Detroit – 6.59 percent with no points

Boston – 6.51 percent with 0.21 point

Houston – 6.49 percent with 0.52 point

Dallas – 6.51 percent with 0.45 point

Washington, D.C. – 6.35 percent with 0.71 point

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