U.S. mortgage applications fell as interest rates rose to their highest level since January 2014.
The market composite index, a measure of mortgage loan application volume, decreased 4.1% on a seasonally adjusted basis for the week that ended Feb. 9 from the previous week, the Mortgage Bankers Association said. The index decreased by 2% from the prior week on an unadjusted basis.
"Both purchase and refinance activity fell over the week, decreasing to levels last seen at the beginning of this year," said MBA economist Joel Kan.
The seasonally adjusted purchase index declined by 6% from the previous week. The unadjusted purchase index fell by 3% from the prior week but was up 4% from the same week a year ago.
The refinance index decreased by 2% from the previous week. The refinance share of mortgage activity increased to 46.5% of total applications from 46.4% in the previous week.
"Refinance activity is continuing along a floor, while the drop in purchase may be related to short-term stock market jitters," Kan said. "Purchase applications were still 4 percent higher than a year ago, and we still expect activity to pick up as we make our way into early spring."