Rates Slip Again To 6.87%

Mortgage rates fell again, but their downward trend may not last much longer.

Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.87%, down from the week prior’s 6.89%. This is its lowest level so far in 2025.

A year ago at this time, the 30-year fixed-rate mortgage averaged 6.77%.

Fifteen-year rates increased, however, jumping to 6.09% from 6.05%. A year ago at this time, they were at 6.12%.

“The 30-year fixed-rate mortgage continued to inch down this week, reaching its lowest level thus far in 2025,” said Sam Khater, Freddie Mac’s Chief Economist. 

“Recent mortgage rate stability is benefitting potential buyers, as purchase demand is stronger than this time last year. This is an indication that a thaw in buyer activity could be on the horizon.”

But inflation data may stymie declining rates.

The Consumer Price Index, released earlier this week, was unexpectedly up 3% on the year thanks to food and energy.

Producer prices also increased, and retail sales slumped far more than analysts had predicted for January.

Treasury yields shot up to more than 4.5% as a result.

The data gives the Central Bank more reason to hold off on rate cuts, which Fed Chairman Jerome Powell has already promised to do. 

“The ‘wait and see’ Fed is going to be waiting longer than anticipated after a red-hot January CPI inflation report,” Josh Jamner, investment strategy analyst at ClearBridge Investments, wrote in a note.

“This report puts the final nail in the coffin for the rate cut cycle, which we believe is over.”

Some analysts even suggested that a rate hike may be on the horizon.