USA: Building interest rates at their highest level in three years

A higher value was last recorded in November 2023. As a result, applications for mortgage loans fell by 4.2 percent compared to the previous week. “Very few homeowners have an incentive to refinance at these interest rates,” said MBA Deputy Chief Economist Joel Kan. »The sharp rise in credit costs has forced many potential buyers out of the market.«

The development could put President Donald Trump under political pressure four weeks before the November 3 congressional elections. According to a survey published on Monday by the Reuters news agency and the Ipsos Institute, the cost of living is the most important issue for those eligible to vote. The high cost of living is considered one reason for Trump's historically low approval rating of 32 percent.

Since the start of the joint attacks on Iran by the USA and Israel at the end of February, building interest rates have risen by around 1.4 percentage points. Inflation was also 3.4 percent in August, well above the Fed's target of two percent. After raising interest rates in September, the Fed has signaled a further interest rate hike by the end of the year. However, markets are not expecting a hike at the next meeting at the end of October.

Building interest rates have also recently risen in Germany. In September, interest rates for building financing with a ten-year fixed interest rate rose to around 4.25 percent annually, as the analysis firm Barkow Consulting told the dpa news agency. This is the highest level since May 2011.