Refi pace should not slow economy

A slower pace of home mortgage refinancing probably won’t weaken consumer spending and hamper expansion because household balance sheets are healthy, according to a study by the Federal Reserve Bank of New York.

Americans refinanced almost 12 million mortgages last year, about one-fourth of the country’s total, compared with 8 million a year earlier, according to the study by Fed economists Margaret McConnell, Richard Peach and Alex Al-Haschimi.

Forecasters, including Goldman, Sachs & Co., have predicted a retrenchment in U.S. consumer spending when interest rates rise and refinancing slows. The central bank’s economists disagreed, saying consumers are managing their debt well.