Mortgage application volume falls 14.2 percent as rates rise

Mortgage application volume fell 14.2 percent during the week ending April 18, according to the Mortgage Bankers Association's weekly application survey.

The MBA's application index fell to 637.6 from 743.4 the previous week.

Refinance volume fell 20.2 percent, while purchase volume declined 6.4 percent. Refinance applications accounted for 49.2 percent of total applications compared with 53.5 percent a week earlier.

The index peaked at 1,856.7 during the week ending May 30, 2003, at the height of the housing boom.

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This article addresses the declining amount of mortgage applications being completed which shows the declining housing market. This article also addresses the rising interest rates of items which prevent some from purchasing or investing. Both of these factors show the declining United States's economy which many hope will not last much longer.

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Wholesale Prices Surge in January

Inflation at the wholesale level soared in January by the fastest pace in 16 years, pushed higher by costs for food, energy and medicine.

The Labor Department said Tuesday that wholesale prices rose 1% last month, more than double the 0.4% increase that economists had been expecting.

The worse-than-expected performance was certain to capture attention at the Federal Reserve, which has chosen to combat a threatened recession by aggressively
cutting interest rates in the belief that weaker economic growth will keep a lid on prices.

But the combination of rising inflation and weaker growth raises the threat of "stagflation," the economic malady that plagued the country through the 1970s, when a series of oil shocks left households battered by the twin problems of stagnant growth and rising prices.

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This article concerns the rising inflation rates that the United States's economy has been experiencing. This increase is attributed to rising costs for food, energy, and medicine. This article also addresses the Federal Reserve's attempt to avoid a recession by drastically cutting interest rates hoping that the "weaker economic growth will keep a lid on prices." Because of these two decisions, there are concerns that the United States's economy will become stagnant, a fear they called "stagflation." There has also been an increase in wholesale prices which the government is going to attempt to fight with one of the previous mentioned methods. The Federal Reserve's role in fighting the stagnation, inflation, and interest rates shall be evident in the next few months to see the measures they take to change these three problems the United States's economy is experiencing.

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Dollar Hits Record Low Versus Euro

The dollar sank to a new low against the euro after the release of three disheartening economic reports Tuesday.

The dollar also hit floating-era lows against the Brazilian real and New Zealand dollar, or "kiwi."

The 15-nation euro leaped to $1.4982 before settling at $1.4967, its previous record, in late New York trading. On Monday, the euro was worth $1.4825. The euro's previous high of $1.4967 was set on Nov. 23.

The New York-based Conference Board said its Consumer Confidence Index fell to 75 in February from 87.3 in January, the index's lowest level since February 2003. The reading was below analysts' expectations.

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This article addresses the recent economic report that was released regarding the value of the American dollar and the euro. According to the article, the dollar hit an all-time low compared to the euro, the Brazilian real, and the New Zealand dollar ("kiwi"). Also the Consumer Confidence Index has fallen to seventy-five which is an all-time low since February 2003, dropping from 87.3 in January. Also the inflation rate has increased by one percent which is more than anticipated; this rise is contributed to the rising oil and food costs. This article shows the fluctuation of the United States's economy. It is the government's "job" to make the economy achieve more stable levels, so the government should attempt to implement policy to allow this to occur.

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