MBA Mortgage Applications (week ended 12/14/2012)
Purchase Index Week/Week -5.0%
Refinance Index Week/Week -14.0%
Composite Index Week/Week -12.3%
Purchase application fell after 5 weeks of gains. Rates drive refinancing. I believe that we are seeing the premium in prices in the Treasury market (lower yields and rates) which was created by the fiscal cliff angst being removed from the market. It is odd that this illusion counts more than the Fed’s increase in money supply. We will likely see jitter in Treasuries and mortgage rates as perception regarding the fiscal cliff issue seems to change daily.
Starts – Level – (seasonally adjusted, annualized) 861,000. Previous was revised down to 888,000
Permits – Level – (seasonally adjusted, annualized) 899,000.