Just one day after the Federal Reserve raised its benchmark rate, mortgage rates took a sharp turn lower.
The average rate on the popular 30-year fixed mortgage fell to 5.22% on Thursday from 5.54% on Wednesday, when the Fed announced its latest rate hike, according to Mortgage News Daily. The rate fell even further Friday to 5.13%.
Rates hadn’t moved much in the days leading up to the Fed meeting earlier this week, but they had been slowly coming off their most recent high in mid-June, when the 30-year fixed briefly crossed 6%.
The drop Thursday also came on the heels of the Bureau of Economic Analysis’ gross domestic product report, which showed the U.S. economy contracted for the second straight quarter. That is a widely accepted signal of recession. GDP fell 0.9% at an annualized pace for the period, according to the advance estimate. Economists polled by Dow Jones had expected growth of 0.3%.
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