US average mortgage rates rise slightly; 30-year at 2.98%

WASHINGTON (AP) — Mortgage rates rose slightly this week after three weeks of declines as new economic data underscores the recovering economy's strength. The benchmark 30-year home loan, however, remains below 3%.

Mortgage buyer Freddie Mac reported Thursday that the average 30-year rate ticked up to 2.98% from 2.97% last week. At this time last year, the long-term rate was 3.23%.

The rate for a 15-year loan, popular among those seeking to refinance, rose to 2.31% from 2.29% last week.

Experts are expecting mortgage rates to increase modestly in the short term, while remaining at low levels in light of the Federal Reserve’s goal of keeping its key interest rate near zero until the economy recovers from the pandemic.

After its rate-setting meeting this week , Fed Chairman Jerome Powell made clear Wednesday that the central bank isn’t even close to starting a pullback in its ultra-low interest rate policies. This despite the economy’s rapid strengthening, inflation showing signs of picking up and the country making progress toward defeating the viral pandemic.

Even with historically low rates, buyers are having a hard time snatching up homes because there are so few available for sale.

Bright news came in a government report Thursday that the economy grew last quarter at a vigorous 6.4% annual rate, powered by consumers and fueled by federal aid.

It indicates that the economy is achieving a remarkably fast recovery from the recession unleashed by the coronavirus that cost tens of millions of people their jobs and businesses.