FX.co ★ US Mortgage Application Decline

US mortgage applications fell 6.4% in the week ending July 24, the steepest weekly drop in two months. The decline coincided with a rise in benchmark mortgage rates: the average rate on a 30-year fixed-rate mortgage climbed to 6.76%, a one-year high, as persistent inflation and a solid labor market reinforced expectations of a Federal Reserve rate hike later this year. Refinancing applications, which are particularly sensitive to short-term rate movements, dropped 9.9% from the previous week to their lowest level since May of last year. Applications for mortgages to purchase homes also declined, falling 3.6% over the same period.