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Mortgage rates have held mostly steady for the second week in a row, as the market continued to digest mixed economic news and became comfortable with the Fed's rate target, which isn't likely to move any time soon.

Government-backed mortgage buyer

Freddie Mac


said Thursday that long-term rates were mostly unchanged, with adjustable rates falling slightly. Freddie's chief economist, Frank Nothaft, attributed the stability to "offsetting economic data" that showed strong growth in consumer credit, but weak retail sales, indicating that Americans may be simply holding back on purchases, even if they are able to spend more.

Those trends were combined with mixed data for the housing market as well. Signs that home sales may be improving during the typically slow summer months was welcome news for the market.

However, Fed data showed that banks have further tightened lending standards, even for prime borrowers. In other words, even if consumer appetite is strengthening, banks "may dampen further home sales activity going forward," Nothaft says.

Until there are clearer signals on which way the housing market and broader economy is headed, mortgage rates have been fairly stable. The average 30-year fixed-rate mortgage had an interest rate of 6.52% and an upfront payment of seven-tenths of a point for the week ended Thursday, unchanged from the previous week.

Shorter term 15-year fixed mortgages averaged 6.07% with the same upfront payment, down from 6.1% a week earlier.

Five-year hybrid adjustable-rate mortgages, which are indexed to Treasury notes, averaged 6.02% with a payment of six-tenths of a point. Those rates dropped from 6.05% a week earlier. One-year ARMs averaged 5.18% with a half-point payment, down from 5.22%.

All rates are down from year-ago levels. Consumers can check the best local rates by entering their ZIP codes at