WASHINGTON - Rates on 30-year mortgages rose for a fourth straight week, hitting the highest level in 10 months, as bond markets responded to strong employment growth.
Mortgage giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages averaged 6.53 percent. That was up sharply from 6.42 percent the week before and represented the highest point for 30-year mortgages since they averaged 6.55 percent on Aug. 10.
Analysts attributed the increase to recent signs of economic strength outside of the slumping housing market including last week's report that the economy created 157,000 jobs in May, nearly double the April pace.
"Mortgage rates climbed this week owing to market concerns of a tight labor force and wage growth," said Frank Nothaft, Freddie Mac's chief economist.
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He said that bond markets have also grown concerned about renewed inflation pressures, reflected in a report this week that unit labor costs rose at a 1.8 percent annual rate in the first three months of this year, double the government's initial estimate.