Mortgage rates surged to their highest level since September on Friday as bond yields moved higher due to the war in Iran.
The average rate on the 30-year fixed loan hit 6.41%, according to Mortgage News Daily. That is the highest rate since the first week of September, but still below the 6.78% notched at the same time last year.
Mortgage rates loosely follow the yield on the 10-year U.S. Treasury, which were up again Friday.
“This is counterintuitive for those who expect bonds to serve as a safe haven in times of uncertainty, but when war has a direct impact on inflation expectations, it’s more than enough to offset any of the safe haven benefit that might otherwise be seen,” wrote Matthew Graham, chief operating officer at Mortgage News Daily.
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