U.S. mortgage rates fall in week

The 30-year, fixed-rate mortgage averaged 5.38 percent with an average 0.7 points in the week ending June 18, Freddie Mac said.

A week ago, 30-year, fixed-rate mortgages averaged 5.59 percent with an average 0.7 points. A year ago, the average rate was 6.42 percent.

At 4.89 percent with an average 0.7 points, the 15-year, fixed-rate average also declined, dropping from the previous week's average of 5.06 percent. A year ago, 15-year fixed-rate mortgages averaged 5.89 percent, the report said.

"Reports of benign inflation figures reversed the upward trend of mortgage rates this week," said Frank Nothaft, Freddie Mac vice president and chief economist.

Nothaft noted the producer price index rose 0.2 percent in May with an annual decrease of 1.3 percent from May 2008.

"It's still too early to tell whether the decline in housing market activity has hit bottom yet," he added. "The prior three-week run up in rates for 30-year fixed mortgages ... is starting to slow home buyer demand, at least temporarily," he said.

Copyright 2009 by United Press International.