The Mortgage Bankers Association (MBA) reported on Wednesday the mortgage application volume in the U.S. rose 5.4 percent in the week ended October 4, following an 8.1 percent climb in the previous week.

According to the report, refinance applications surged 10 percent, while applications to purchase a home fell 1.0 percent.

Meanwhile, the average fixed 30-year mortgage rate decreased to 3.90 percent from 3.99 percent.

“U.S. Treasury rates moved sharply lower last week, as data showing weakness in the services sector was a sign that slowing economic growth is not confined to the manufacturing sector,” said MBA’s Joel Kan, Associate Vice President of Economic and Industry Forecasting. “This in turn caused a flight to safety by investors, resulting in mortgage rates dropping across the board.”