WASHINGTON, Sept. 2 (UPI) -- Average interest rates for long-term mortgages set record lows in the week ending Sept. 2, the U.S. Federal Home Loan Mortgage Corp. said Thursday.

Freddie Mac said "modest inflation expectations" contributed to the drop in interest rates for 15-year and 30-year fixed rate mortgages, which have numerous record lows through the summer.

"The 12-month price growth of core personal expenditures remained at 1.4 percent in July, which kept overall inflation expectations well at bay," said Freddie Mac Deputy Chief Economist Amy Crews Cutts.

In the latest weekly survey, Freddie Mac said interest rates for 30-year, fixed-rate contracts dropped from 4.36 percent with an average of 0.7 points, to 4.32 percent, a 39-year low.

Average interest rates for 15-year, fixed-rate mortgages fell from 3.86 percent to 3.83 percent. Points for 15-year mortgages averaged 0.6 during the week.