The bearish sentiment that has unexpectedly prevailed in the bond market since early February has driven mortgage rates up. Sharply higher rates will significantly reduce this year's originations of single-family mortgages.

We now project that 1994 originations will total around $675 billion, a plunge of $450 billion from the record volume of 1993. The projected sizable drop will come entirely from the subsidence in refinancing.

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