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Mortgage rates drop on heels of Fed announcement

Posted by The Aramco Group on Tue, May 10, 2016 @ 14:05 PM

Mortgage rates in the United States fell last week after the Federal Reserve announced it's decision not to raise short-term interest rates. The drop pushes long-term mortgage rates closer toward historically low levels. The development arrives just in time for the spring home buying season.

Mortgage giant Freddie Mac places the average conforming no-point 30-year fixed-rate mortgage at 3.61 percent and 15-year rates at an average of 2.86 percent. This is down from last week's 3.66 percent and 3 percent respectively.

Prices for government bonds remained at high levels with the yield on the 10-year Treasury bond having a great influence on mortgage rates.

The Fed moved last December to raise it's benchmark rate from zero for the first time in nearly a decade. However changes in the economic climite has experts believing that another rate hike may not take place until the latter part of 2016.

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