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Mortgage rates climb
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April 19, 2001: 1:21 p.m. ET
Adjustable-rate mortgages dip to an almost two-year low after Fed's rate cut
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NEW YORK (CNNfn) - Long-term mortgage rates rose for the fourth consecutive week, but the one-year adjustable rates dipped to an almost two-year low following the Federal Reserve's surprise interest rate cut Wednesday by half a percentage point.
According to Freddie Mac, the benchmark 30-year fixed-rate mortgage (FRM) averaged 7.14 percent for the week ending April 20, slightly higher from last week's average of 6.55 percent. A year ago, the same mortgage averaged 7.82 percent.
The average this week for a 15-year fixed-rate mortgage was at 6.66 percent, up from the previous week's average of 6.55 percent. A year ago, the same rate stood at 7.82 percent.
One-year adjustable rate mortgages (ARMs) hit an almost two-year low since July 30, 1999, averaging 6.08 percent, down from last week's average of 6.15 percent. The same mortgage averaged 6.76 percent this time last year.
[Click here to see a breakdown of U.S. mortgage rates by region.]
"Mortgage rates crept up over the end of last week and into this week, as the market ruled out any intervention by the Federal Reserve before the next FOMC meeting," said Robert Van Order, chief economist for Freddie Mac. "But following the release of the Consumer Price Index (CPI), which indicated that inflation remains in check, the Fed unexpectedly lowered interest rates by half a percentage point."
"Since the Fed's cut influences other short-term rates more than long-term rates, we may see the ARM rates fall a bit more by next week. We also expect the impact on long-term rates will be minimal," Van Order said.
Freddie Mac (FRE: Research, Estimates), or Federal Home Mortgage Corp., is a publicly traded company the government established in 1970 to provide a flow of funds to mortgage lenders.
It buys mortgages from banks, bundles them and then resells them as mortgage-backed securities. Its products, and the products of other, similar entities, have become increasingly popular as an alternative to government-backed bonds, particularly with international investors. 
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