To describe yesterday’s action in a word...boring. Mortgage backed securities and treasuries both traded in a very tight range. On the day, MBS stayed in a 6 tick range while the benchmark 10 year note traded between a high yield of 3.50 and a low yield of 3.46. With the ever so important employment situation report coming out Thursday, I suspect this trend to continue for at least today, but we must remain defensive (per AQ and MGs technical indicators). MBS have posted some nice gains over

If you read the blog yesterday, I stated that we were in need of a rally in treasury yields in order for prices of mortgage backed securities to improve before mortgage rates to could move lower. Well, that is what happened. The benchmark 10 year treasury note, after touching on 3.70 resistance in the morning, made a dramatic turnaround and by day’s end before closing near 3.50%. Helping the cause was the last leg of this week's Treasury auctions. Yesterday the Treasury auctioned $27 billion

Following Monday’s fairly calm day, mortgage backed securities continued to trade in a holding pattern yesterday. At the beginning of the session, mortgage-backs were down as much as 8/32nds but fought back and were up 6/32nds at one point in the day. By day’s end, MBS closed close to where the day began. It is very typical for lenders to employ conservative pricing strategies when MBS prices move lower in the morning, however as MBS prices improve lenders are usually willing to pass

Last week ended on a good note with mortgage backed securities(MBS) rallying into the close on Friday. So far this morning, the upward trend in MBS price(higher price, lower rates) is continuing. The media attributes the rally to global conflict (Iran almost in a state of rebellion and North Korea is well North Korea) and the World Bank announcing lowered forecasts of global growth for this year and next year. AQ and MG say this a function of technical trading biases. Regardless of reasoning, fundamental

What a roller coaster ride we have been on lately. Yesterday mortgage backed securities(MBS) traded way up, then sold off all gains, leaving us just about where we started the day. After the release of weaker than expected inflation data, MBS went on quite a rally which created quite a bit of optimism in the mortgage community about sub-5% mortgage rates. However, like we have said a few times during recent rallies, we must remain defensive as things could change quickly. To see a graph of yesterday's

As I stated in my blog yesterday, my public duty is calling as I have been selected for jury duty.(Don't you envy me?) This will require me to do things a little different with my blog. Instead of waiting until economic data is released to post, I will be forced to post the blog before the data sets. I will recap the prior day's data, and let you know what other reports are due out and how they may affect the markets. I highly encourage you to read the MBS Commentary blog throughout the day

Following the completion of the Treasury Department's most recent fundraising event (all three auctions done) , mortgage backed securities rode a rally wave towards lower mortgage rates yesterday. The rally across the yield curve yesterday helped MBS prices move marketedly higher in price and lower in yield, allowing lenders to pass along improved mortgage rates. Many lenders repriced several times and by days end, borrowing costs decreased by .625 in discount points which lowered the par interest

After a nice rally yesterday, prices of mortgage backed securities (MBS) have moved lower this morning, indicating a probably rise in rates. Remember, as price goes DOWN, investors supplying the money for mortgages are essentially demanding a higher return in order to buy. That “return” correlates to rates. Around the globe, stock markets are in rally mode after global consumer confidence improved for the 3 rd month in a row leading many around the world to believe the worst is over.