The benchmark 30 year fixed rate mortgage rose 12 basis points from 6.33% last week to 6.45% this week according to a national survey mortgage lenders.   The increase in rates was largely fueld by this week's surprisingly strong CPI showing unexpectedly large inflationary pressure at the level of the consumer, and the FOMC minutes this week which suggested that the Fed could possibly increase key short term interest rates at their next meeting.  This has led to slump in bond prices this week and a significant run up in mortgage rates.

Published on July 18, 2008