Mortgage Rates, Inflation, and Yields All Rise in April

This April, mortgage rates continued to increase as ceasefire negotiations remain inconclusive. According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.34% last month, 16 basis points (bps) higher than in March. The average 15-year rate also increased by 13 bps to 5.69%. Despite the recent increase, both rates remain lower than a year ago by 39 bps and 21 bps, respectively.

The 10-year Treasury yield, a key benchmark for long-term borrowing, averaged 4.31%, up 7 bps from March. Ongoing blockades in the Strait of Hormuz have kept oil prices above $100 per barrel. This has passed through to inflation which climbed to 3.3%, nearing a two-year high. Energy components led the increase with fuel oil prices rising 30.7% and gasoline rising 21.2% in March.

At its latest meeting, the Federal Reserve held the federal funds rates unchanged at 3.5% to 3.75% as inflation remains elevated alongside continued economic expansion.