http://www.mortgagenewsdaily.com/ Mortgage News Daily https://www.mortgagenewsdaily.com/markets/mbs-recap-05202026 Wed, 20 May 2026 20:19:36 GMT 6a0e25bca6791958c5d3c87b Matthew Graham Full Reversal And Then Some Bonds more than made up from Tuesday's rout with a massive rally on Wednesday. Unlike Tuesday's move, which was driven by bond-market-specific selling pressure on the part of one account's massive liquidations, Wednesday's rally was broad-based and driven by war-related headlines. Specifically, newswires suggested the U.S. and Iran are now very close to agreeing on a plan to end the war. The market isn't just hearing "wolf!" It's pretty sure it's seeing an actual wolf on the horizon. This is important and ongoing proof of concept regarding the prospect of additional improvement in the event speculation becomes reality. Conversely, it's also a reminder that things can change quickly if the peace narrative deteriorates in coming days. Market Movement Recap 08:49 AM moderately stronger overnight. MBS up an eighth and 10yr down 2.1bps at 4.646 10:27 AM gaining some ground on Pakistan headlines (potential final draft of peace terms tomorrow). 10yr down 3.7bps at 4.629 and MBS up just over a quarter point. 01:18 PM Near best levels. MBS up 3/8ths and 10yr down 8.8bps at 4.58 02:53 PM MBS up 5/8ths and 10yr down 10bps at 4.567 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mortgage-rates-05202026 Wed, 20 May 2026 18:58:00 GMT 6a0e0775c631c9085d7ebbac Matthew Graham Wednesday brought some much-needed relief for the mortgage market after rates surged to new 9 month highs of 6.75% yesterday. Whereas that rate spike was decoupled from the prevailing narrative of war-related headlines, today's recovery was quite the opposite. Newswires came out shortly after 10am ET that suggested the U.S. and Iran are nearing a final draft of a peace agreement. While such news has been prone to correction and revision, the market was nonetheless willing to respond quickly and rather forcefully. Oil prices dropped sharply with Treasury yields in tow. In the bond market, "yield" is another word for "rate." And because mortgage pricing is directly dictated by mortgage-specific bonds, when yields are falling, mortgage rates will almost always be falling as well. The average lender fully erased yesterday's rate spike, ultimately making it back below the levels seen on Monday afternoon. Granted, Monday's levels were still the highest in many months at the time, but we have to start somewhere. At the very least, today's market movement reiterates the fact that rates will likely make an even better recovery when the war is officially over. [thirtyyearmortgagerates] Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/opinion/pipelinepress-05202026 Wed, 20 May 2026 15:43:52 GMT 6a0da70eb40197620ba9e2cc Rob Chrisman Here in New York, as over a thousand of us head to airports (hopefully avoiding manholes… tragic), the mood has been pragmatic. Not overly optimistic, not somber, just realistic. No one is arguing that the war hasn’t driven up worldwide oil prices, impacting inflation and borrower psychology, impacting lending. The Mortgage Bankers Association now predicts a Federal Reserve rate hike to arrive in 2027, so any lenders or originators hoping for lower rates, well… At this point there isn’t a lot of reason for rates to drop unless higher oil prices slow the economy further. We knew that a second Trump Administration would impact the economy and regulatory environment, and along those lines… SCOTUS Justice Kennedy built a constitutional protection into fair lending disparate impact doctrine for mortgage lenders in a 2015 case and then accidentally ensured it would never work. Read attorney Brian Levy’s latest Mortgage Musing to find out about fair lending compliance in the second Trump term and sign up for free on Substack to get Levy’s Musings delivered directly to your email box. (Today’s podcast can be found here and this week’s ‘casts are sponsored by TransUnion. Discover how data-driven mortgage intelligence is helping lenders identify in-market borrowers, strengthen portfolio performance, personalize outreach, retain customers, and drive smarter growth in an increasingly competitive housing market. Today’s has an interview with LendingTree’s Rob Bhatt on how home insurance costs are rising far faster than both inflation and household income growth nationwide.) Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-morning-05202026 Wed, 20 May 2026 14:24:52 GMT 6a0dd288a6791958c5d32346 Matthew Graham Tuesday's massive wave of bond-specific weakness still has the analytical community scratching its collective head. Our contacts are either saying nothing or telling us they're just as perplexed. So far this morning, there hasn't been any sort of repeat performance.  Lower oil prices have helped bonds find their footing, but the move has relied on breaking news regarding the potential for the final text of the peace agreement to be drafted by tomorrow. On the calendar front, the 2pm FOMC Minutes release is the only thing that seems like it might be relevant, but as a reminder, this is just a more detailed account of the meeting that took place 3 weeks ago, and we've heard plenty of Fed speakers clarify their outlook over those 3 weeks.  Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-recap-05192026 Tue, 19 May 2026 20:57:48 GMT 6a0cdd9ca6791958c5d1668c Matthew Graham Whales Making Waves in Treasury Futures Nerd alert: there's no way to discuss what happened in the bond market today without getting a bit nerdy. Reason being, there was an absolute deluge of block trades in Treasury futures (over $20bln--the biggest day we can remember for outright block trades). There are a few different possibilities for how this went down, but the size, structure, and timing of those trades suggests that only one or two massive players were involved. The saving grace of a move like this is that it means there was not broad-based selling pressure from a majority of the market. And although this could be viewed as "thought leadership" that inspires other sellers, those sellers had a chance to jump on the bandwagon today and instead held their ground.  Econ Data / Events ADP Employment Change Weekly 42.25K vs -- f'cast, 33.0K prev Market Movement Recap 09:04 AM Gradually weaker overnight with no standout market movers. MBS down almost 3/8ths and 10yr up 4bs at 4.63 11:24 AM MBS down 5/8ths and 10yr up 8.6bps at 4.675 02:46 PM Recovering a bit. MBS down just over half a point and 10yr up 7.2bps at 4.662 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mortgage-rates-05192026 Tue, 19 May 2026 19:28:00 GMT 6a0cbc43045fe12ce3cc32d7 Matthew Graham It was another rough day for the bond market and, thus, for interest rates. Investors aggressively sold bonds in the first 2 hours of trading, taking 10yr Treasury yields to the highest level in more than a year. Mortgage-specific bonds have been doing better versus Treasuries in recent months thanks to increased purchase demand from Fannie Mae and Freddie Mac. All else equal, higher demand for mortgage bonds = lower rates, relatively. In the current case, it means mortgage rates haven't moved up as much as Treasury yields over the past 6 months. That said, rates have still definitely moved higher. Today's top tier 30yr fixed rate is up to 6.75% for the average lender--the highest since July 2025, and a whopping 0.75% higher since before the Iran war began. This makes it the fastest rate spike seen since late 2024. [thirtyyearmortgagerates] Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/opinion/pipelinepress-05192026 Tue, 19 May 2026 15:55:21 GMT 6a0c5788107097c225509350 Rob Chrisman One of the discussion topics here in New York at the MBA conference is, just like every other conference, artificial intelligence, and one of the questions is, “Who’s accountable if something goes wrong?” Any one of us in capital markets will tell you that, in the case of Freddie, Fannie, investors, and so on, lenders are held ultimately accountable for anything that goes wrong. In the event of a buyback, or default, a lender can’t point at an AI vendor and say, “You cover the losses.” Make sure that with any software that you buy you know where it came from and how it was designed, and ask lots of “what if” questions. Sprinkling some AI fairy dust over some legacy technology that is years old can cause serious issues. (Today’s podcast can be found here and this week’s ‘casts are sponsored by TransUnion. Discover how data-driven mortgage intelligence is helping lenders identify in-market borrowers, strengthen portfolio performance, personalize outreach, retain customers, and drive smarter growth in an increasingly competitive housing market. Today’s has an interview with Acrisure’s Kristen Britton on how lenders are balancing speed, automation, fraud prevention, and human oversight as remote closings reshape mortgage risk, identity verification, and the future framework of trust in digital transactions.) Lender and Broker Products, Software, and Services The ICE 2026 Borrower Insights Survey shows a 10 percent year-over-year drop in borrowers who say they are definitely satisfied with communication with their mortgage servicer. Pair that with the survey finding that 96 percent of borrowers say personalized communications remain important to them. These findings suggest servicers need tools that go beyond basic payment processing and to deliver relevant, timely outreach that satisfies borrowers and supports retention. ICE Servicing Digital offers the communication tools to help turn transactional relationships into lasting ones, including surfacing personalized refinance scenarios, current rates and tappable equity alerts directly to borrowers. Read the blog for more insights into borrower communication preferences and how to strengthen borrower relationships. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-morning-05192026 Tue, 19 May 2026 13:40:02 GMT 6a0c767ca6791958c5d09abd Matthew Graham Ever since the initial 2 week ceasefire was announced in the Iran war, the bond market has adhered to trend channels that align with either de-escalation or re-escalation sentiment. Nothing too complicated here: if sentiment is trending in favor of peace, bonds have rallied. If sentiment is deteriorating, bonds have sold off. There was a temporary diversion as traders waited to see if last week's China summit would be a catalyst for a shift. When the summit failed to deliver, yields jumped back in line with the re-escalation trend. Now this morning, they're already challenging the bearish boundary of that trend WITHOUT any new justification from an oil price spike, stock market rout, or any new news on the war. In other words, bonds are telling politicians to get serious about ending the war or face increasingly dire consequences. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-recap-05182026 Mon, 18 May 2026 20:18:22 GMT 6a0b82bca6791958c5ceea41 Matthew Graham Bombarded by Headlines, But Little-Changed Monday's trading session ended up being an exercise in headline-watching, as has been the case on so many days since the start of the Iran war. Today was more active than normal in that regard. The earliest headlines (as covered in the AM commentary) were helpful until they weren't. Subsequent headlines continued pushing back on the notion of an easy peace deal until 3pm. At that point, Trump posted that a planned military operation for tomorrow was cancelled and that serious negotiations were now taking place between great leaders and allies, and that a deal will be made. Bond yields and oil prices dropped on that one with Treasuries ultimately making it back to unchanged in the final hour of the session. Market Movement Recap 08:55 AM Some early gains on war headlines. MBS up 5 ticks (.16) and 10yr down 1.8bps at 4.573 11:04 AM Gains fully erased as newswires push back on previous headlines. MBS down 1 tick (.03) and 10yr up 1.8bps at 4.61 02:48 PM New lows. MBS down a quarter point and 10yr up 2.7bps at 4.618 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mortgage-rates-05182026 Mon, 18 May 2026 19:34:00 GMT 6a0b6bb6b92937618432b2b4 Matthew Graham Mortgage rates hit their highest levels in more than 9 months at the end of last week. Now today, they've edged slightly higher yet again with the average top tier 30yr fixed rate at 6.68% versus 6.65% on Friday. This wasn't necessarily destined to be the case today. In fact the day began with the average lender unchanged. But the underlying market remains highly attuned to breaking news on the Iran war. Earlier in the day, that news was helpful for rates as it spoke to the possibility of compromise on a peace deal. Subsequent headlines refuted the initial news, thus pushing the financial market back in the other direction (i.e. toward higher rates). The result was that the average lender recalled their initial rate offerings and re-released higher rates. Things were on track to be even worse this afternoon when Trump said he was cancelling a planned attack and that serious negotiations were taking place. This helped bonds recover some of the earlier losses, but not enough for lenders to make any friendly rate adjustments today.  Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full