Mortgage Applications down. Trade Deficit up.

MBA Mortgage Applications (week ended 6/13/2014)

– Purchase Index Week/Week -5.2%. Previous weeks were +9.0%, -4.0%, -1.0%, -3.0%, -1.0%, +9.0%, -4.0%, -3.0%, +1.0%, +3.0%, +1.0%, and +3.0%.

– Refinance Index Week/Week -13.0%. Previous weeks were +11.0%, -3.0%, -1.0%, +4.0%, +7.0%, +2.0%, -7.0%, -4.0%, +7.0%, -5.0%, and -3.0%.

– Composite Index Week/Week -9.2%. Previous weeks were +10.3%, -3.1%, -1.2%, +0.9%, +3.6%, +5.3%, -5.9%, -3.3%, +4.3%, -1.6%, and -1.2%.

It is easy to understand the refi index because rates rose sending refi applications down.  The Purchase Index indicates the underlying weakness which persists in housing.

Current Account Deficit (1stQ2014)

– Current Account -$111.2 billion.  Previous was $-87.3 billion.

This is the trade deficit.  The higher deficit is the result of a softening in exports.  This indicates a weaker world economy.

The current account deficit is offset by a surplus in the capital account.  In plain English, foreign governments, corporations, and individuals own $111.2 billion more in U.S. capital accounts than the did the previous quarter.