Encouraging economic data pushed mortgage rates higher for the first time in more than two months this week.
Investors were buoyed by news of increased consumer spending, higher construction spending and an improving manufacturing sector. With demand for bonds waning, yields on the 10-year Treasury rose. Because home loan rates tend to follow the movement of long-term bonds, mortgage rates also moved higher.
According to the latest data released Thursday by the Federal Home Loan Mortgage Corp., the 30-year fixed-rate average ticked up to 3.64 percent with an average 0.5 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.62 percent a week ago and 3.75 percent a year ago.
The 15-year fixed-rate average crept up to 2.94 percent with an average 0.5 point but remained below 3 percent for the fourth week in a row. It was 2.93 percent a week ago and 3.03 percent a year ago.
The five-year adjustable-rate average climbed to 2.84 percent with an average 0.5 point. It was 2.79 percent a week ago and 2.96 percent a year ago.
“The market turbulence that kicked off the year subsided at the end of February, providing at least a temporary break in the flight to quality,” Sean Becketti, Freddie Mac chief economist, said in a statement.
“Treasury yields approached their highest level in a month, boosting the 30-year mortgage [two] basis points this week to 3.64 percent. Despite this welcome breather, Fed officials have been highlighting the downside risks to the economic outlook, and the market expects the Fed to refrain from any further short-term rate increases for now.”
Meanwhile, mortgage applications were down, according to the latest data from the Mortgage Bankers Association.
The market composite index — a measure of total loan application volume — fell 4.8 percent from the previous week. The refinance index tumbled 7 percent, while the purchase index dropped 1 percent.
The refinance share of mortgage activity accounted for 58.6 percent of all applications.