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Economy in Brief
U.S. Mortgage Applications Continued to Slide Amid Higher Rates
The biggest declines have been in refinancing activity, while applications for purchase are just starting to crack...
UK Inflation Jumps
Inflation is at the highest rate since the series began in January of 1989...
U.S. Industrial Production Much Stronger than Expected in April
The increase in manufacturing output in April was once again led by motor vehicle and parts production...
U.S. Retail Sales Posted Solid Rise in April
Notwithstanding falling real incomes and declining confidence measures, consumer spending posted a solid increase...
U.S. Home Builder Index Took a Steep Drop in May
This is the fifth straight month that builder sentiment has declined...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
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Peak Inflation & Fed Policy: A Relationship Which Should Worry The Fed And Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
by Tom Moeller June 12, 2019
The Mortgage Bankers Association reported that its total Mortgage Applications Index surged 26.8% (45.0% y/y) during the week ending June 7 after the prior week's 1.5% rise. The rise reflected a 46.5% jump in applications to refinance an existing loan, which have doubled y/y. Applications to purchase a home increased 10.0% (11.8% y/y) after declining in six of the prior seven weeks.
The effective interest rate on a 15-year fixed-rate mortgage fell w/w to 3.61%, compared to a high of 4.71% early in November 2018. The effective rate on a 30-year fixed-rate loan declined to 4.21% and remained below the November high of 5.33%. The rate on a 30-year Jumbo mortgage fell to 4.09%, down from its October peak of 5.09%. The rate on an adjustable 5-year mortgage eased to 3.55%. It's recent high was 4.52% averaged last October.
The average mortgage loan size surged w/w to $358,100 (20.7% y/y) but remained below the record of $381,700 in late-March. For purchases, the average loan size eased to $329,600 (+5.4% y/y). The average loan refinancing size jumped to $386,800 (44.6% y/y). These series date back to 1990.
Applications for fixed-rate loans rose 43.3% y/y, while adjustable rate loan applications gained 69.2% y/y.
The survey covers over 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.
MBA Mortgage Applications (%, SA) | 6/7/2019 | 5/31/2019 | 5/24/2019 | Y/Y | 2018 | 2017 | 2016 |
---|---|---|---|---|---|---|---|
Total Market Index | 26.8 | 1.5 | -3.3 | 45.0 | -10.4 | -17.8 | 15.6 |
Purchase | 10.0 | -2.4 | -1.4 | 11.8 | 2.1 | 5.6 | 13.3 |
Refinancing | 46.5 | 6.4 | -6.0 | 97.2 | -24.3 | -34.0 | 17.3 |
15-Year Mortgage Effective Interest Rate (%) | 3.61 | 3.74 | 3.83 | 4.37 (June '18) | 4.35 | 3.59 | 3.22 |