U.S. mortgage rates averaged 3.02% for week-ending June 24, a gain of nine basis points from the previous week and the first time in 10 weeks that it has exceeded 3%, according to the Mortgage Bankers Association’s seasonally adjusted index.

The rise in mortgage rates comes as bond markets responded to signs that the Federal Reserve could hike rates sooner than expected.

A year ago at this time, the 30-year fixed-rate mortgage averaged 3.13%. In January, mortgage rates hit a record low of 2.65% after plummeting during the pandemic.

Cheaper borrowing costs have boosted the housing market.

“As the economy progresses and inflation remains elevated, we expect that rates will continue to gradually rise in the second half of the year. For those homeowners who have not yet refinanced – and there remain many borrowers who could benefit from doing so – now is the time," Sam Khater, Freddie Mac’s Chief Economist, said in a statement.