WASHINGTON (AP) — U.S. long-term mortgage rates fell this week for the second straight week as anxiety has spiraled over devastation to the economy from the coronavirus pandemic.
Home-loan rates have been hitting all-time lows. Mortgage buyer Freddie Mac reported Thursday that the average rate on the benchmark 30-year loan dipped to 3.33% this week from 3.50%. A year ago the rate stood at 4.08%.
Freddie Mac said demand from prospective homebuyers has weakened in response to economic concerns.
The average rate on the 15-year fixed-rate mortgage declined to 2.82% from 2.92%.
The recent declining trend in mortgage rates has been driven by investors shifting money out of the stock market and into the safety of U.S. Treasurys as the crisis in confidence caused by the global viral outbreak has worsened. The number of cases confirmed worldwide crossed the grim milestone of 1 million this week.
Long-term mortgage rates tend to track the yields on the 10-year Treasury note, so they typically fall in tandem.
Financial markets have shuddered amid a cascade of job losses and shutdowns across the globe due to the COVID-19 virus, as a severe global recession looms closer. Wide swaths of the U.S. economy have ground closer to a standstill as authorities ask Americans to stay home to slow the spread of the virus.
The U.S. lost a stunning 701,000 jobs in March, the worst since the depths of the Great Recession in 2009, the government reported Friday. And it’s just a small indication of what’s to come. Economists expect as many as a record 20 million losses in April and an unemployment rate of around 15%, the highest since the 1930s.
Stocks fell in U.S. trading Friday after the release of the unemployment report. Losses accelerated after New York’s governor announced the biggest daily jump yet for deaths caused by the virus in the country’s hardest-hit state. Deaths from COVID-19 in the state were estimated at nearly 3,000.