Inflation just increased again. Here's what that could mean for mortgage interest rates.
Summary
Inflation rose to 4.2% in May, higher than the Federal Reserve's 2% target and the highest in over three years. This increase may cause mortgage interest rates to rise, making home loans more expensive for buyers and those refinancing.Key Facts
- Inflation reached 4.2% in May, up from 3.8% in April.
- The Federal Reserve aims to keep inflation around 2%.
- Inflation affects the cost of borrowing, including mortgages.
- Strong job growth was reported with 172,000 new jobs in May.
- The Federal Reserve will meet mid-June and may keep rates steady for now.
- If inflation and employment stay high, the Fed might raise interest rates later.
- Lenders might raise mortgage rates before any official Fed action.
- Borrowers are advised to lock in current mortgage rates and check their credit scores.
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