U.S. 30-Year Mortgage Rate Holds at 6.48% as Deficits and Inflation Fears Lift Yields
Updated
Updated · The Conversation · Jun 4
U.S. 30-Year Mortgage Rate Holds at 6.48% as Deficits and Inflation Fears Lift Yields
3 articles · Updated · The Conversation · Jun 4
Summary
Freddie Mac said the average 30-year U.S. mortgage rate was 6.48% on June 4, staying well above 6% and up sharply from roughly 6% in February.
Investor expectations—not the Fed’s policy rate—are driving borrowing costs, with lenders and mortgage-bond buyers demanding higher yields to offset inflation uncertainty, elevated oil prices and the Iran conflict.
Federal borrowing is adding pressure: the CBO estimates Trump’s 2025 tax and immigration law will add $3.4 trillion to deficits through 2034, increasing Treasury supply and pushing up benchmark yields that mortgages often track.
Mortgage-backed securities also carry prepayment risk, so investors demand an extra premium above 10-year Treasuries; that spread has remained elevated, keeping home-loan rates high even after Fed cuts in 2024 and 2025.
Current rates are painful for buyers and refinancers, but they are not historically extreme—30-year mortgages often ran between 6% and 8% in the 1990s and early 2000s.