U.S. Mortgage Rates Rise on Iran, Bond Volatility

U.S. mortgage rates rose again, with the average 30-year fixed rate climbing to about 6.71% (highest in more than a year) and 15-year rates rising to around 6.04%. Higher borrowing costs are expected to restrain homebuying and contribute to a sluggish housing market, even as total mortgage application volume edged up slightly. Multiple reports attribute the move to escalating U.S.-Iran conflict, which has pushed oil prices higher, raised inflation expectations, and driven up Treasury yields; investors have also cited concern about growing government debt. Because mortgage pricing tracks Treasury yields and swap rates, further bond-market volatility could lift fixed-rate costs again. The pattern is showing abroad as higher UK gilt yields increase pressure on mortgage-rate benchmarks. Some borrowers are also shifting toward ARMs or other differently structured options as lenders adjust their pricing.