The average rate on a 30-year mortgage moved back above 7% this week, snapping a 3-week trend of reductions and serving up a a setback for home shoppers at a time when the U.S. housing market is already slowing under the strain of rising prices.

The rate rose to 7.03% from 6.94% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.79%.

This is the first increase after a three-week pullback.

The Fed has been holding the federal funds rate at the highest level in more than two decades in hopes of grinding down on the economy enough to get high inflation fully under control. The central bank has maintained it doesn’t plan to cut interest rates until it has greater confidence that price increases are slowing to its 2% target.

Court opens door on mortgage escrow interest

The Supreme Court on Thursday gave homeowners another chance to force Bank of America and other large banks to pay interest on mortgage escrow accounts.

The court unanimously threw out an appeals court ruling in favor of Bank of America, which has refused to pay interest on money it collects to pay borrowers’ insurance and property tax bills.

New York requires banks to pay at 2% interest on escrowed funds.

Thirteen other states have similar laws: California, Connecticut, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, Oregon, Rhode Island, Utah, Vermont and Wisconsin.

Justice Brett Kavanaugh wrote for the Supreme Court that the appeals court did not perform the kind of nuanced analysis required by federal law and prior Supreme Court decisions to determine if a state law must give way to a federal statute.

In particular, Kavanaugh noted that the Dodd-Frank Act, enacted after the 2008 financial crisis, made clear that not all state banking laws are pre-empted.