Baby boomers appear to have a considerable impact on the mortgage basis, said analysts from Barclays Capital in a report released last week "Demographic changes have been a big driver of bank deposit growth, and we believe this will continue, fueling bank appetite for MBS," they wrote.

According to Barclays, the question facing the mortgage market is what factors are driving deposit growth increase and whether the phenomenon will continue. From the data presented by the firm, it becomes clear that bank deposit growth has risen hand in hand with home equity extraction, partly explaining why bank deposits have grown so fast in recent years.

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