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US long-term mortgage rates are rising; 30-year average – 2.97%

WASHINGTON (AP) – US long-term mortgage rates have risen this week, but remain at an all-time low as the epidemic-stricken economy recovers as more Americans get vaccinated against the coronavirus.

Mortgage buyer Freddie Mack said on Thursday that the average interest rate on a benchmark 30-year real estate loan rose 2.97% from 2.81% a week earlier. In contrast, a year ago the benchmark interest rate was 3.45%.

The average interest rate on loans with a 15-year fixed interest rate, popular among those wishing to refinance mortgages, has risen to 2.34% from 2.21% last week.

Although economists expect modest growth in mortgage rates this year, they are likely to remain low as the Federal Reserve raises interest rates to near zero until the economy recovers.

Record low loan rates have helped push buyers into the housing market. On Wednesday, the government said demand for new homes rose 4.3 percent in January, confirming that the housing market remains one of the strongest sectors of the US economy. But the lack of home supply, which pushed up prices even before the outbreak of the previous epidemic, left many prospective buyers empty-handed in March.

The number of Americans applying for unemployment benefits fell sharply last week as a sign that cuts could be made, although benefits applications remain at historically high levels. The Department of Labor reported Thursday that unemployment claims fell 111,000 from a week earlier to a seasonally adjusted 730,000. The latest data coincides with the weakened labor market, which has made considerable progress over the past three months.

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