Despite another 3bps drop in 30-year primary rates, the Mortgage Banker’s Association (MBA) Refinancing Index increased to 8840.9 from 8351.1 for the week ending May 23, 2003, which is only a 6% rise from the previous week. This week’s results are short of last week’s projected high-9000 level.

In research this morning, Citigroup said that the Index might have been higher if it were not for the Memorial Day weekend. Because many borrowers might have started their holiday weekend earlier, the Index may be slightly subdued. If a quarter-day adjustment was used, the Index would have increased by 11% to 9306. The main reason for the rise was another dip in mortgage rates. Analysts believe that weekly average rates declined by 10 basis points to 20 basis points.

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