Additionally, builders anticipate further gains in construction activity in the coming months due primarily to strong economic fundamentals. Sales of new homes rose modestly last month, remaining substantially above year-ago levels. Inventories of unsold new homes are at low to moderate levels. Mortgage lenders say demand edged down last month but remained well above year-ago levels. Refinancing continued to lead mortgage activities.
Lenders expect mortgage demand to stay strong over the next three months.
Banking Bankers report that loans and deposits both edged up last month, leaving loan-deposit ratios unchanged. Consumer loans, residential construction loans, and agricultural loans all rose, while commercial and industrial loans declined somewhat. Increases in demand deposits, NOW accounts, and money market deposit accounts were partly offset by a decline in large CDs. All respondent banks left their prime lending rates unchanged last month and expect to hold rates steady in the near term. Most banks held their consumer lending rates constant and anticipate no future changes.