US mortgage rate climbs to 6.71%, new high since November

ISTANBUL

US mortgage applications saw a weekly decline and the 30-year fixed mortgage rate climbed to a new highest level since November, according to a report by the Mortgage Bankers Association (MBA).

The Market Composite Index, a measure of mortgage loan application volume, fell 5.7% on a seasonally adjusted basis for the week ending Feb. 24, compared to the previous week. On an unadjusted basis, the index fell 4% from the previous week.

The 30-year fixed rate increased to 6.71% last week, which drove a 6% drop in applications, according to the report released Wednesday. The level is a fresh new high since November after it stood at 6.62% for the week ending Feb. 17.

"After a brief revival in application activity in January when mortgage rates dropped to 6.2 percent, there has now been three straight weeks of declines in applications as mortgage rates have jumped 50 basis points over the past month," MBA Vice President and Deputy Chief Economist Joel Kan said in the report.

"Data on inflation, employment, and economic activity have signaled that inflation may not be cooling as quickly as anticipated, which continues to put upward pressure on rates," he added.

The average contract interest rate for 15-year fixed-rate mortgages rose to 6.13%, from 5.98%, for the week.

The MBA survey covers more than 75% of all US retail residential mortgage applications.