NEW YORK (Reuters) - Interest rates on U.S. 30-year fixed-rate mortgages posted their first weekly decline since Donald Trump's U.S. presidential election victory on Nov. 8, mortgage finance agency Freddie Mac (PK:FMCC) said on Thursday.
The borrowing cost on 30-year mortgages, the most widely held type of U.S. home loan, averaged 4.20 percent in the week ended Jan. 5, it said. Last week, 30-year mortgage rates averaged 4.32 percent, which was the highest since 4.33 percent in the week of April 24, 2014.
Home borrowing costs have retreated in line with U.S. bond yields as investors returned to the bond market.
Trump's surprise win had stoked bets on a surge in federal borrowing and inflation as a result of possible steep tax cuts and federal spending to stimulate business investment.
Mortgage rates advanced further in the latter half of December after the Federal Reserve on Dec. 14 hinted it might raise short-term interest rates at a faster pace than previously thought on an improving jobs market and signs of inflation moving up to its 2 percent goal.
Benchmark 10-year Treasury yields (US10YT=RR) reached 2.64 percent on Dec. 15, which was the highest since September 2014, but have since subsided and stood at 2.41 percent early on Thursday.
While mortgage rates cooled in the latest week, their sharp rise has hurt refinancing activity, Freddie Mac chief economist Sean Becketti said.
The Mortgage Bankers Association said on Wednesday its index on refinancing applications