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Fed’s Schmid says inflation needs tighter policy as mortgage rates rise
A 30-year fixed mortgage at 6.69% would run about $185 more per month than at February’s 5.98% level, before taxes and insurance.
Mortgage rates continued climbing in late summer, with the average 30-year fixed rate rising for a fifth straight week to 6.69% as of Aug. 6, the highest level since July 2025, according to Freddie Mac, as outlined by Yahoo Finance.
Federal Reserve Bank of Kansas City President Jeff Schmid said in an Aug. 4 speech that inflation remains too high and that the Fed will need tighter policy to return inflation to its 2% target. Schmid did not specify when or by how much rates should rise, Yahoo Finance reported, and the Fed’s latest meeting left the benchmark rate at 3.5% to 3.75% while three officials voted for a hike.
With mortgage rates around 6.69%, Yahoo Finance calculated that principal and interest on a $400,000 30-year loan would be about $2,578 per month. At February’s brief low of 5.98%, the same loan would have cost about $2,393 per month, or roughly $185 less.
The story notes that while the Fed does not directly set mortgage rates, its decisions can shift bond-market expectations and borrowing costs, and mortgage rates typically track the 10-year Treasury yield. Yahoo Finance said the 10-year reached 4.65% recently, up from 3.97% before the U.S.-Iran conflict began in February, citing the Associated Press, with the conflict helping push oil prices higher and keep inflation concerns elevated.