MBS Well Off Highs But Reprice Risk is Minimal
Treasuries have been losing ground since 11:44am--the same time that stock prices bounced. Since then, 10yr yields have moved up to 2.608, the highs of the day.
MBS have come along for the ride, but relative to Treasuries, haven't lost as much ground. Fannie 3.5s are still in positive territory at 102-01.
While that's as much as 5 ticks weaker than the day's best levels, it's still in line with most lenders' rate sheet print times. As such, most lenders will wait for further losses before considering reprices.
Very rarely, a lender or two will reprice based on a strong, intraday selling trend, regardless of the distance from initial rate sheet pricing. That's more of a reminder for those of you with loans at a lender who's shown that historical predisposition. For everyone else, we'd need to see 2-3 ticks lower before reprice risk began picking up.