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U.S. Mortgage Rates Hit 6.88% Amid Persistent Inflation and Geopolitical Tensions

Inflation exceeded expectations for the third consecutive month, impacting Federal Reserve rate cut prospects and increasing market volatility.

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Overview

  • Inflation continues to surpass estimates, leading to a decrease in the likelihood of a Federal Reserve rate cut from 60% to 20% in June.
  • Rising geopolitical tensions in the Middle East contribute to market instability and higher commodity prices.
  • Consumer sentiment in the U.S. declines as economic anxiety increases due to persistent inflation.
  • Mortgage rates surge to 6.88%, exacerbating affordability issues in an already strained housing market.
  • Artificial intelligence's growing energy demands could account for up to 25% of U.S. energy consumption by 2030.