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MBS RECAP: Fed Minutes Largely As Expected; No Major Drama For Bonds
Nov 24 2021, 4:18PM

After weathering the storm of this morning's data, the bond market turned its attention to the afternoon's release of the Minutes from the most recent Fed meeting.  While there were comments about the potential to accelerate the pace of tapering (thus pulling forward the potential rate hike timeline), they were only registered among a few of the meeting participants.  Treasuries mostly yawned at the data, but MBS are underperforming.  Liquidity is a factor here as well as the flatter yield curve on the day.  From here on out, liquidity issues add a higher degree of variability to MBS prices.  This risk won't subside until next week at the earliest.

Econ Data / Events
  • Fed MBS Buying 10am, 11:30am, 1pm

  • GDP (q3, prelim) 2.1 vs 2.2 f'cast, 2.0 prev

  • Jobless Claims 199k vs 260k f'cast, 270k prev

  • Durable Goods -0.5 vs 0.2 f'cast, -0.4 prev

  • Nondefense, ex-aircraft 0.6 vs 0.5 f'cast, 1.3 prev

Market Movement Recap
08:58 AM

slightly stronger in Asia, then modestly weaker during European hours.  Additional weakness after AM econ data.  10yr up 1bp at 1.684 and MBS down nearly an eighth of a point.

09:25 AM

Daly comments pushing bonds to weakest levels of the day.  More detail in the alert HERE

11:38 AM

Treasuries bouncing nicely with 10yr now down almost 3bps.  MBS being pulled up from weakest levels, somewhat.  2.5 coupons now down only 6 ticks (.19).

01:53 PM

MBS moving back toward the lows before the Fed Minutes, but not any lower than they were this morning.  Bonds overall are stable with 10yr yields about 2bps lower and MBS prices about an eighth of a point lower.

02:22 PM

Limited reaction to the Fed in Treasuries.  MBS aren't doing as well for a variety of reasons (discussed in alerts and in the recap)


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
UMBS 2.5
101-23 : -0-04
Treasuries
10 YR
1.6380 : -0.0270
Pricing as of 11/24/21 4:18PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:06PM  :  ALERT ISSUED: MBS At New Lows as Markets Sift Through Minutes
12:44PM  :  Decent Recovery Despite Underperformance
10:09AM  :  ALERT ISSUED: No Whammies in 10am Econ Data, But MBS Underperform
9:24AM  :  ALERT ISSUED: More Losses After Fed's Daly's Comments
8:49AM  :  Slightly Weaker After First Round of Econ Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Ted Rood  :  "My present to EVERYONE this year is timely reminders that MBS Live marketing portal has oodles of FREE articles, which can be posted on social media tagged with your info, amazing mortgage calculators which will help your clients understand loan options, AND, MG's Nobel Prize winning weekly newsletter!"
Matt Graham  :  "I'll always answer these questions the same way: If the answer to that could be known by anyone, don't you think traders would be trading it already?"
Ted Rood  :  "While we're focused on Thanksgiving, I'm completely grateful for MG, other MBS Live leadership, and this community."

Economic Calendar
Time Event Period Actual Forecast Prior
Wednesday, Nov 24
7:00 MBA Purchase Index w/e 295.7 282.5
7:00 MBA Refi Index w/e 2706.2 2695.0
8:30 GDP Prelim (%) Q3 2.1 2.2 2.0
8:30 Durable goods (%)* Oct -0.5 0.2 -0.3
8:30 Core CapEx (%)* Oct 0.6 0.5 0.8
8:30 Jobless Claims (k) w/e 199 260 268
8:30 Continued Claims (ml) w/e 2.049 2.033 2.080
10:00 Core PCE Inflation (y/y) (%)* Oct 4.1 4.1 3.6
10:00 New Home Sales (ml) Oct 0.745 0.800 0.800
10:00 Consumer Sentiment (ip) Nov 67.4 66.9 66.8
10:00 Sentiment: 5y Inflation (%) Nov 3.0 2.9
10:00 Sentiment: 1y Inflation (%) Nov 4.9 4.9
10:00 New Home Sales (%) (%)* Oct 0.4 14.0
14:00 FOMC Minutes *

About the Author

Chief Operating Officer, Mortgage News Daily / MBS Live
A former originator, Matthew began writing for Mortgage News Daily in 2007, covering a wide range of topics. Seeing a need in the marketplace, his focus increasingly shifted toward relating MBS and broader financial markets for loan originators. ... more

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