The volume of mortgage applications in the US soared by 10.9% from the previous week in the first week of August, extending the 3.1% jump from the earlier period, to mark the sharpest increase in mortgage demand in two months, according to data from the Mortgage Bankers Association. The surge was aligned with a 10bps reduction in benchmark mortgage rates in the period, their lowest in four months, as the aggressive reductions in payroll aggregates drove long-term yields in US notes and bonds to plunge. Applications for a contract to refinance a mortgage, which are more sensitive to short-term changes in interest rates, surged by 23% from the earlier week to extend the 5.1% jump in the last period of July. On the other hand, applications for a mortgage to purchase a new home rose a softer 1.4%.