U.S. mortgage rates stay high

Investors' inflation expectations, much more than the central bank, are among the factors that affect the cost of home loans.

1. Frame 1Freddie Mac data released June 4 puts the U.S. housing market under pressure: 30-year mortgage rates average 6.48%.
2. Frame 2High borrowing costs squeeze buyers and refinancing homeowners, keeping pressure on a sluggish U.S. housing market.
3. Frame 3Trump is pressing the Fed for deeper cuts, but it directly controls short-term bank lending rates.
4. Frame 4Thirty-year mortgages are priced by financial markets, so home-loan rates do not move in lockstep with Fed decisions.
5. Frame 5Investors buying mortgages and securities price years of inflation, growth, government borrowing, and future interest rates.
6. Frame 6The practical test is whether investors see inflation and borrowing risks easing enough to lower mortgage yields.