Thank goodness for a boring day. The alternatives would be that the mega-rally of the past two days extends further, which causes all sorts of problems for the mortgage market, or that rates snap quickly higher, which would cause another set of problems. "Sideways at recent lows" is always the best place to be.
Bond markets aren't completely sideways though. There is a bit of weakness--more visibly in MBS vs Treasuries--but not enough to undo Wednesday's range-break. Today began with an almost perfectly neutral stance and has merely leaked a little to the downside after stronger-than-expected Housing Starts data. The reaction was limited by the fact that there's really no growth coming out of the single-family construction sector.
Fannie 3.5s were off more than a quarter of a point at their weakest levels, but have gotten roughly half of that back as Treasuries broke even early in the afternoon.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
| MBS || |
98-15 : -0-03
102-14 : -0-04
105-13 : -0-02
| Treasuries || |
0.3589 : +-0.0001
2.5000 : -0.0020
3.3245 : -0.0135
| Pricing as of 5/16/14 12:54PMEST |
Morning Reprice Alerts and Updates
11:33AM : ALERT ISSUED: MBS at Weakest Levels; Not Much Reprice Risk Unless we Move Lower
10:05AM : Consumer Sentiment Weaker Than Expected; Limited Response in Bond Markets
8:40AM : Bond Markets Losing Ground After Stronger Housing Starts Data
Live Chat Featured Comments
Scott Valins : "gm all nice to see us hold 2.5 overnight"
Matthew Graham : "RTRS- US APRIL HOUSING STARTS 1,072,000 UNIT RATE (CONSENSUS 980,000) VS MARCH REV 947,000 UNIT RATE (PREV 946,000 UNITS)"
Matthew Graham : "RTRS- US APRIL HOUSING PERMITS 1,080,000 UNIT RATE, HIGHEST SINCE JUNE 2008 (CONSENSUS 1,010,000) VS MARCH REV 1,000,000 UNIT RATE (PREV 997,000 UNITS)"
Matthew Graham : "mitigating factor in the data, look how much of the strength was in multi-family "
Jeff Anderson : "Was just reading that. Only up 1% for single family units. That's not great. Seems mindset is slightly shifting to renting."
Matthew Graham : "THOMSON REUTERS/U. OF MICH U.S CONSUMER SENTIMENT PRELIMINARY MAY 81.8 (CONSENSUS 84.5) VS FINAL APRIL 84.1"