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Record High MBS Prices, Record Low Rates. What Next?
Bonds and rates clearly aren't looking at economic data as a key source of motivation, nor are they playing by the normal set of rules. Coronavirus has rewritten those rules. How long can this all-time-low rate environment last and how do we approach it from a lock/float standpoint?
Econ Data / Events
11:30-11:50 AM (ET) - Fed 30yr UMBS Buying
ISM Non Manufacturing 57.1 vs 50.1 f'cast
ISM Business Activity 66.0 vs 49.0 f'cast
Market Movement Recap
08:18 AM Bond yields and stocks moved higher out of the gate in the overnight session. Both generally remained elevated into the domestic trading hours. 10yr yields are up 2.8bps at .696 and UMBS 2.0 are down just over an eighth of a point.
10:05 AM Brief and limited reaction to ISM Non-Manufacturing data. Bonds hit weakest levels for a moment, but are already (maybe) bouncing back.
12:36 PM The market appears to be on a 4-day weekend. Extremely flat during domestic hours so far. Both stocks and bonds.
03:07 PM A bit more movement heading into the 3pm CME close for bonds. 10yr yields at lows of day. MBS prices up an eighth of a point with 2.0 coupons up to 102.5. Stocks off highs, but still 1% better on the day.
MBS Commentary
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Record High MBS Prices, Record Low Rates. What Next?
Bonds and rates clearly aren't looking at economic data as a key source of motivation, nor are they playing by the normal set of rules. Coronavirus h... (read more)
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Housing News
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Black Knight has again taken a look at the number of Americans who could benefit significantly from refinancing their first mortgages, but the facts are shifting almost faster than they can report them. In its current Mortgage Monitor , the company r... (read more)
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Housing News
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Despite any impact from the COVID-19 pandemic, construction spending is still largely managing to stay ahead of its 2019 levels . The U.S. Census Bureau said total spending in May was at a seasonally adjusted annual rate of $1.356 trillion, down 2.1 ... (read more)
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Housing News
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The number of homeowners in COVID-19 forbearance dropped sharply this week, to the lowest level since the first week of May. The number of plans which hit a peak on May 22 then declined slowly over the next three weeks but shot up by nearly 80,000 lo... (read more)
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Rob Chrisman
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Here’s a blunt reminder of what can go dramatically wrong in a fireworks stand. And here’s a blunt email that I received over the weekend. “Rob, what don’t people understand? If someone is threatened with a potentially fatal i... (read more)
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Mortgage Rate Watch
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This week's economic data included the biggest-ever gain in Pending Home Sales, a leading indicator for the housing market. Meanwhile, mortgage rates pushed down to new all-time lows yet again. But at what cost? The most pessimistic way to explain th... (read more)
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