US average mortgage rates down slightly; 30-year at 2.96%

WASHINGTON (AP) — Mortgage rates fell slightly this week, marking their third straight week below 3% amid signs of the recovering economy’s strength.

Mortgage buyer Freddie Mac reported Thursday that the average for the benchmark 30-year home-loan rate eased to 2.96% from 2.98% last week. At this time last year, the long-term rate was 3.26%.

The rate for a 15-year loan, popular among those seeking to refinance, slipped to 2.30% from 2.31% last week.

Experts are expecting mortgage rates to increase modestly in the short term, while remaining at low levels in light of the Federal Reserve’s goal of keeping its key interest rate near zero until the economy recovers from the pandemic.

After its rate-setting meeting last week, Fed Chairman Jerome Powell made clear that the central bank isn’t even close to starting a pullback in its ultra-low interest rate policies. This despite the economy’s rapid strengthening, inflation showing signs of picking up and the country making progress toward defeating the viral pandemic.

The latest bright news came in a government report Thursday that the number of Americans seeking unemployment aid fell last week to 498,000, the lowest point since the viral pandemic struck 14 months ago and a sign of the job market’s growing strength as businesses reopen and consumers step up spending. Analysts are forecasting that the government’s monthly employment report out Friday will show the economy added 975,000 jobs in April, according to data provider FactSet, and that the unemployment rate fell from 6% to 5.8%. That would show that more Americans are looking for work and more employers are hiring them.