Freddie Mac Reports U.S. Mortgage Rates Hit Lowest Level in Over a Year

Interest rates on U.S. 30-year mortgages fell to their lowest in more than year following a steep decline in U.S. Treasury yields last week, mortgage finance agency Freddie Mac FMCC.OB said on Thursday.

The average 30-year mortgage rate fell to 3.59 percent in the latest week from 3.71 percent the prior week, Freddie Mac said in its latest week survey.

"This rate marks a new low for 2016 and matches last year's low in February 2015. Low mortgage rates and a positive employment outlook should support a strong housing market in the second quarter of 2016," Sean Becketti, Freddie Mac's chief economist, said in a statement.

Benchmark 10-year Treasury yield US10YT=RR has fallen 8 basis points this week to a 4-1/2 week low of 1.702 percent early Thursday, following last week's 10 basis points decline.

Treasury yields have fallen broadly since last Tuesday in reaction to remarks from Federal Reserve Chair Janet Yellen who said the U.S. central bank should proceed "cautiously" in raising interest rates.