The entire MBS coupon stack is performing well in late afternoon trading and so is the long end of the yield curve...these darn Treasury bidder's are relentless!!!

FN 4.5: +16/32 at 100-13

FN 5.0: +7/32 at 101-09 (GN is +11/32 at 101-09)

FN 5.5: +8/32 at 101-26(GN is +13/32 at 101-26)

FN 6.0: +7/32 at 102-08 (GN +13/32 at 102-02)

FN 6.5: +11/32 at 102-28

We are looking for more aggressive lenders to pass through a portion of these gains...perhaps more so in 5.25 to 6.0 range on rate sheets though. We don't expect too much of a bump in the 4.5 to 5.00 range yet.

The Federal Reserve and Treasury MBS support plan is ramping up prepay speeds and drawing out the down in coupon trend. Good news for rate sheets!!! BUT we are going to have to see a little stability or perhaps a tighter range before investors drop their guard as pass through these gains in the lower portion of the coupon stack. Patience will have to hold you over for now if you are waiting for 4.5 at 100.000.

I think this recent run up in MBS prices deserves a "devil's advocate" sell biased/up in coupon point of view. We will discuss and include in afternoon post