Mortgage rates continue upward climb as evidence of a recovery mounts

WASHINGTON - Mortgage rates around the country continued their upward climb this week amid increasing evidence that an economic recovery is under way. <br> <br> Freddie Mac, the mortgage company, reported that the average interest rate on 30-year fixed-rate mortgages rose to 7.08 percent, up from 6.87 the previous week, according to a nationwide survey released Thursday. A year ago this time, 30-year mortgages averaged 6.96 percent. <br> <br> Rates on 30-year mortgages hit a low of 6.45 percent in early November, their lowest point since Freddie Mac began conducting its nationwide survey in 1971. <br> <br> While rates have moved higher since that time, analysts believe that rates this year will be fairly stable, remaining close to the record lows set last year and will continue to support the housing market. <br> <br> Fifteen-year mortgages, a popular option for refinancing, went up to 6.59 percent, up from 6.37 percent the week before. A year ago, 15-year mortgages averaged 6.54 percent. <br> <br> On one-year adjustable-rate mortgages, lenders were asking an average initial rate of 5.08 percent, up from 5.07 percent the previous week. Last year this time, one-year ARMs averaged 6.29 percent. <br> <br> These rates do not include add-on fees known as points, which averaged around 0.7 percent of the loan amount for all three types of mortgages last week. <br> <br> A slew of recent economic data has pointed to an economic turnaround. A key report came last week when the government said that the nation&#39;s unemployment rate fell to 5.5 percent in February as companies added jobs for the first time in seven months. <br> <br> &#34;Mortgage rates were up this week on news that February employment figures suggested an economic upturn,&#34; said Frank Nothaft, Freddie Mac&#39;s chief economist. &#34;That news, however, puts a bit of upward pressure on long-term mortgage rates.&#34; <br> <br> That&#39;s because with such encouraging economic news, investors are raising their bets that the Federal Reserve may need to boost interest short-term interest rates later this year. The Fed cut rates 11 times last year to revive the economy, which fell into a recession in March 2001. <br> <br> Fed policy-makers opted to leave rates alone at their meeting in January and they are expected to do the same when they meet next week. <br> <br>

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