The volume of mortgage applications in the US fell by 1.2% from the previous week in the period ending August 2th, extending the 0.5% drop in the earlier week to mark the three consecutive readings of declines in mortgage demand, according to data from the Mortgage Bankers Association. The fresh drop took place despite a 5bps reduction in benchmark mortgage rates, which eased to the lowest level in nearly five months. Applications for a mortgage to buy a new home fell by 1.2%, aligned with weakening consumer sentiment to halt four consecutive weeks of gains. In the meantime, applications for a contract to refinance a mortgage, which are more sensitive to short-term changes in interest rates, inched higher by 0.9%.