Mortgage Rates Today, Wednesday, June 10: A Little Higher

The average rate on a 30-year fixed mortgage held at 6.46% APR, while annual inflation climbed to 4.2%, its highest level in three years, according to data released Wednesday and Thursday.

The mortgage rate was unchanged from the prior week, according to rates provided to NerdWallet by Zillow ^[2]. A separate report from NerdWallet a day earlier had described the rate as rising three basis points to that same 6.46% level ^[1]. The Bureau of Labor Statistics released the latest Consumer Price Index on Wednesday, showing a 0.5% monthly increase that pushed the annual inflation rate to 4.2% ^[1]. Inflation has been above the Federal Reserve's 2% target for more than five years ^[1]. The Federal Reserve is scheduled to meet next week ^[1]. Elizabeth Renter, a NerdWallet senior economist, said the inflation numbers "will be top of mind" at that meeting ^[1]. "Under new Fed Chair Warsh, the Committee will be sussing out whether what we're seeing in the data represents something that will work itself out in time or whether it risks being persistent," Renter said. "Paired with the labor market data from last week, we know a rate cut is all but off the table" ^[1]. Supporting a faltering labor market is the Federal Reserve's key rationale for cutting rates, because lowering interest rates increases spending, which can boost business but also spur inflation ^[2]. Raising the federal funds rate is the central bank's main tool for slowing inflation ^[1]. Mortgage lenders often begin pricing in expected Fed moves well ahead of official announcements, and if the central bank signals future rate increases, that would likely add upward pressure on mortgage rates ^[1].