Mortgage rates continued higher this week after markets speculated the Federal Reserve may soon raise interest rates to counter inflation, according to surveys conducted by Freddie Mac and

In Freddie Mac’s survey, the 30-year fixed-rate mortgage increased to an average 6.67 percent for the week ended today, up from last week’s average of 6.62 percent, and has not been higher since the week ended June 13, 2002, when it averaged 6.71 percent.

The average for the 15-year fixed-rate mortgage is 6.26 percent, up from last week’s average of 6.23 percent, and has not been higher since the week ended May 24, 2002, when it averaged 6.28 percent.

Points, which are fees charged by lenders for loan processing, averaged 0.4 on both the 30- and 15-year loans.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 6.26 percent this week, with an average 0.5 point, down from last week when it averaged 6.21 percent. The one-year Treasury-indexed ARM averaged 5.68 percent, with an average 0.7 point, up from last week when it averaged 5.61 percent, and has not been higher since the week ended Aug. 17, 2001, when it averaged 5.71 percent.

“The Fed released the minutes of its most recent FOMC meeting, which showed that some members were concerned about inflationary pressure. This caused the bond market yields to rise, and brought about market speculation that the Fed may hike rates sooner than had been expected,” said Frank Nothaft, Freddie Mac vice president and chief economist. “All this combined to nudge rates up again this week.

“Higher mortgage rates will coincide with a cooling housing market. Although our forecast is for slightly higher rates, the rise will be gradual and orderly over the year.”

In’s survey, fixed mortgage rates posted a slight increase, with the average 30-year fixed-rate mortgage rising from 6.69 percent to 6.72 percent. The 30-year fixed rate mortgages in this week’s survey had an average of 0.35 discount and origination points.

The average 15-year fixed-rate mortgage popular for refinancing inched higher to 6.32 percent, reported. On larger loans, the average jumbo 30-year fixed rate increased to 6.91 percent from 6.87 percent. Adjustable-rate mortgages were mixed, as the average 5/1 ARM rose to 6.29 percent, and the average one-year ARM dipped to 5.89 percent. reported that mortgage rates have see-sawed back and forth in recent weeks on news of a softening housing market and a hawkish inflation stance by the Fed. While mild economic news gives the Federal Open Market Committee room to pause at upcoming meetings, brewing inflation threatens to keep the Fed in the game and raise interest rates further. Yields on Treasury securities react to either possibility, moving up and down with the day’s news. Mortgage rates are closely related to yields on long-term government bonds.

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

New York – 6.7 percent with 0.22 point

Los Angeles – 6.77 percent with 0.48 point

Chicago – 6.83 percent with 0.06 point

San Francisco – 6.79 percent with 0.27 point

Philadelphia – 6.64 percent with 0.38 point

Detroit – 6.76 percent with no points

Boston – 6.74 percent with 0.28 point

Houston – 6.68 percent with 0.61 point

Dallas – 6.58 percent with 0.68 point

Washington, D.C. – 6.55 percent with 0.69 point


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