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U.S. mortgage applications dip, but purchase demand edges up -MBA

NEW YORK, Oct 23 (Reuters) - Applications for U.S. home loans dropped slightly in the latest week as decreased refinancing activity offset a slight rise in demand for purchase loans, data from an industry group showed on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 0.6 percent in the week ended Oct. 18. That followed a gain of 0.3 percent in the previous week.

The figures came against the backdrop of a U.S. federal government shutdown, which ended during the latter part of last week. The shutdown cast a spotlight on fiscal policy, with some economists worrying it put a drag on the economy.

The shutdown affected the mortgage market, the MBA said in the previous survey.

MBA data showed 30-year mortgage rates edged down 7 basis points to 4.39 percent, the lowest rate since June.

The refinancing index fell 1.3 percent. By contrast, the gauge of loan requests for home purchases, a leading indicator of home sales, rose 0.7 percent.

The mortgage survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.