feb 22 reuters  the average interest rate on the most popular us home loan rose last week to its highest since november as bond markets took fright that the federal reserve might have to continue tightening policy through summer to subdue inflation data from the mortgage bankers association mba showed on wednesday the average contract rate on a 30year fixedrate mortgage jumped by 23 basis points to 662 for the week ended feb 17 following strongerthanexpected retail sales and labor market data as well as still robust monthly inflation readings which compelled investors to up their bets that the us central bank will have to keep raising its policy rate through the summer that has caused a spike in us treasury yields and a second straight weekly increase in mortgage rates after several weeks of declines the yield on the 10year note acts as a benchmark for mortgage rates mortgage rates soared to more than 7 last october as the central bank raised its benchmark policy rate in 2022 at the fastest pace in 40 years but had began to ebb after signs late last year that inflation was on the wane the interestrate sensitive housing sector has borne the brunt of the feds actions the renewed rise on mortgage rates caused more potential buyers to sit on the sidelines the mbas purchase composite index a measure of all mortgage loan applications for purchase of a single family home dropped 181 from the prior week to its lowest level since 1995 the mbas market composite index a measure of overall mortgage loan application volume also declined 133 from a week earlier other housing data on tuesday showed that us existing home sales dropped to the lowest level in more than 12 years in january but the pace of decline slowed raising cautious optimism that the housing market slump could be close to reaching a bottom