U.S. mortgage application activity falls to five-month low

November 2, 2016 08:23 AM

A measure of U.S. mortgage application activity decreased for a second week to a five-month low as 30-year mortgage rates rose to their highest since June, data from the Mortgage Bankers Association released on Wednesday showed.

The Washington-based industry group's mortgage market index fell 1.2% to 486.2 in the week ended Oct. 28, which was the lowest level since the week of May 27.

Interest rates on 30-year fixed-rate mortgages, which are the most widely held type of U.S. home loans, averaged 3.75% in the latest week, matching the level last seen in June, MBA said.

Mortgage rates increased with higher U.S. Treasury yields with 10-year yields hitting their highest levels in about five month last week. 

U.S. bond yields climbed on speculation about whether overseas central banks may refrain from injecting more monetary stimulus to help their economies.

The group's seasonally adjusted index on weekly applications to buy a home edged down 0.4% to 207.0 last week, which was the lowest since January.

The purchase activity gauge is seen as a proxy on home sales.

MBA's weekly barometer on refinancing requests declined by 1.6% to 2,088.0, which was the weakest since June.

The share of refinancing activity rose to 62.7% of total applications, unchanged from the previous week.

About the Author