Today's trading has offered an interesting development or two.  The first was the reaction to the Durable Goods data.  It was significantly weaker than expected at  -1.4 vs a +0.4 forecast.  While this report is historically volatile, we still would have expected at least a modest improvement in bond markets.  But within minutes of the report, trading levels were back to opening levels or weaker. 

That was the first ominous cue of the day, and fact that bonds erred on the side of weakness (relative to the data) is especially notable considering the opposite was the case over the past two days.

The next interesting development was a more determined sell-off (albeit a small one)heading into the 10am hour.  European bond market weakness was even more pronounced during the selling.  Other factors included profit-taking from the recent rally, an uptick in corporate bond issuance, and the fairly normal level of concessionary selling that tends to precede the bigger Treasury auctions.    The 5yr auction is coming up at at 1pm and is the next scheduled potential market mover.


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
102-12 : -0-03
FNMA 3.5
105-04 : -0-02
FNMA 4.0
106-29 : -0-02
Treasuries
2 YR
0.5870 : +0.0260
10 YR
1.8850 : +0.0120
30 YR
2.4730 : +0.0070
Pricing as of 3/25/15 12:13PMEST

Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:12AM  :  ALERT ISSUED: Edging Toward Negative Reprice Risk For Some Lenders
9:25AM  :  Important Lack of Conviction After Huge Durable Goods Miss

Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Steve Chizmadia  :  "http://mndne.ws/1iAHDx5"
Ben Biscoe  :  "LP streamlined accept"
Victor Burek  :  "yes...Freddie sometimes allows for just 1 year returns.."
Daniel Kramer  :  "question: Is there a Freddie program that only requires one year of tax returns from a self-employed borrower to refinance his primary home? Borrower purchase home for all cash 7 months ago, and is now trying to pull cash out into a mortgage for about 70% LTV. this is NOT a HARP loan. but a high balance 30 yr fixed loan. he has other mortgage peeps whispering in his ear that they can do this with a Freddie program. I have never heard of this outside of HARP. "
Matthew Graham  :  "From the NYT piece: Q. You’ve said that you expect the Fed to start raising rates at one of three meetings: June, July or September. Are you confident it will happen by September? A. I wouldn’t say I’m 100 percent confident. I noted that Stan Fischer said, “This year.” So for me to say June-July-September full confidence is probably overstating it, but I think it’s quite likely. And if we were to go beyond September, it would be because we were really disappointed in the stream of data that come in."
Matthew Graham  :  "Balance it out with severate news from Evans at 9:04 ET in the news stream "shouldn't raise rates this year." "
Matthew Graham  :  "this news was making the rounds about an hour ago, in various forms. It may have had something to do with weakness around the 930am time frame"
Matthew Graham  :  "RTRS- ATLANTA FED PRESIDENT DENNIS LOCKHART SAYS 'QUITE LIKELY' TO RAISE RATES BY SEPTEMBER - NEW YORK TIMES"
Jason Anker  :  "Yup. Should be an interesting summer."
Victor Burek  :  "and if fed tightens, dollar gets even stronger...causing more weakness "
Matthew Graham  :  "RTRS - U.S. FEB DURABLES EX-DEFENSE ORDERS -1.0 PCT VS JAN +2.3 PCT (PREV +2.9 PCT)"
Matthew Graham  :  "RTRS- U.S. FEB DURABLES EX-TRANSPORTATION ORDERS -0.4 PCT (CONS +0.3 PCT) VS JAN -0.7 PCT (PREV UNCHANGED)"
Matthew Graham  :  "RTRS- US FEB DURABLES ORDERS -1.4 PCT (CONSENSUS +0.4 PCT) VS JAN +2.0 PCT (PREV +2.8 PCT)"