July 9, 2009 / 3:01 PM / 9 years ago

UPDATE 1-US 30-year mortgage rate slides to six-week low

(Adds quote from Freddie Mac, background)

NEW YORK, July 9 (Reuters) - U.S. long-term fixed mortgage rates slid to a six-week low in the past week as a weakening labor market dragged down the government debt yields used to peg home loan costs.

The average 30-year rate dropped 0.12 percentage point to 5.20 percent in the week ended July 9, Freddie Mac FRE.N said on Thursday.

A year earlier, the rate was 6.37 percent, the second-largest U.S. home funding company said.

“Interest rates for 30-year fixed-rate mortgages fell for the second week in a row to the lowest level in six weeks amid market concerns over a weakening labor market,” Frank Nothaft, Freddie Mac’s chief economist, said in a statement.

The most recent jobs report issued by the government last week showed a 9.5 percent unemployment rate in June, the highest since August 1983.

Weaker economic reports helped lower the yields on Treasury securities, which are used to benchmark mortgage rates.

The average 30-year mortgage rate fell to 4.78 percent in April, a record low dating back to 1971 based on Freddie Mac’s weekly surveys.

Lenders charged an average of 0.7 percent on 30-year loans in the latest week, unchanged from the prior week.

See more rates in the week ended July 9 at [ID:nWEQ001183]. (Reporting by Lynn Adler, Editing by Chizu Nomiyama)

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