Panic In The Bond Market It's no mystery that longer-term Treasury yields have been trending higher since August (it's all we can talk about at times) and that mortgage rates have largely been able to ignore that trend.  But that blissful ignorance is increasingly hard to maintain--a fact that hits home on days like today.  For a variety of reasons, today was a big bad day for Treasuries.  As feared, MBS were painfully unable to outperform, and the same can be said of mortgage rates compared to MBS prices.  Bottom line: rates rose sharply.  Multiple lenders repriced for the worse.  This is part of an ongoing, widespread reevaluation of economic and monetary outcomes as told by the bond market. There's no guarantee that things get better before they get worse.  Econ Data / Events Fed MBS Buying  10am, 1130am, 1pm NY Fed Manufacturing 12.1 vs 6.0 f'cast, 3.5 prev Market Movement Recap 08:28 AM Bonds sharply weaker overnight, including heavy selling in futures on Monday.  Snowball momentum.  Global reflation/rotation trade (shifting gears into growth mode.  Buy stocks, sell bonds).  Strong data in Europe.  Bank of Japan reaffirms ETF buying commitment.  US stimulus on track to be bigger than expected.  Global stocks soaring.  10yr up big to 1.25+.  UMBS 2.0 down 30bps+ 10:47 AM More weakness after the Fed's regularly scheduled Treasury buying operation showed an ongoing preference for shorter-dated paper (this was a 20-30yr operation and they bought mostly 23-24yr paper).  Dealers put bonds on sale immediately thereafter and 10s consequently jumped to the highs of the day, up 6+ bps at 1.27+.  MBS aren't too much worse for the wear (compared to this morning), but are nonetheless at their lows with 2.0 coupons down almost 3/8ths. 02:30 PM Bonds have been treading water near their weakest levels since the last update, but MBS lost additional ground just now with 2.0 coupons off by more than half a point.  Afternoon hours are often less liquid for MBS and illiquidity can exacerbate strength and weakness alike. 03:58 PM More movement of the clock, more selling of the bonds!  10yr yields cracked 1.30% and 2.0 UMBS fell more than 5/8ths of a point.  No new motivations--just ongoing momentum.  Widespread negative reprices.  

February 16, 2021 Download our Mobile App: Download our Mobile App: MBS Commentary MBS Live Recap: Panic In The Bond Market Panic In The Bond Market It's no mystery that longer-term Treasury yields have been trending higher since August (it's all we can talk about at times) and that mortgage rates have largely been able to ignore ... (read more) Rob Chrisman IT, MLO, Training Jobs; VA IRRRL, Sales, Final Doc Tools; Non-Agency Product Trends; Mortgage Rates? Ouch! Despite the lousy weather in many parts of the nation, and Mardi Gras being cancelled, the year is off to a fine start for lenders, and borrowers benefitting from lower rates. Might there be clouds on the horizon? Sure. Rates are creeping higher, esp... (read more) Housing News Revisions to Fannie's Automated System May Lead to Easier Approval Fannie Mae will implement a new version of its Desktop Underwriter (DU) after the weekend of March 13 . Version 11.0 apply to loan casefiles submitted on or after that date, but casefiles created in the previous version. The changes in this release i... (read more) Housing News FHFA Extends Forbearance Periods an Extra Three Months Most of the accommodations that have been allowed lenders and borrowers by the Federal Housing Finance Agency (FHFA) due to the COVID-19 pandemic were modified or extended this past week. FHFA, the regulator and conservator of the GSEs Fannie Mae and... (read more) Mortgage Rate Watch Mortgage Rates Lowest in More Than a Week Mortgage rates haven't been moving much recently, but they've logged enough small victories to make it back to the lower levels seen on February 1st . Depending on the specific scenario and the lender, a quoted rate may or may not be visibly differen... (read more) Housing News Low Rates, COVID are Motivating Prospective Home Buyers A high percentage of those who told the National Association of Home Builders (NAHB) late last year that they were thinking of buying a home have now turned thought into action. Rose Quint writes in the NAHB Eye on Housing blog that 15 percent of tho... (read more) Mortgage Rates 30 Yr. Fixed Rate 6.79% +0.02% Rate Change Points Mortgage News Daily 30 Yr. Fixed 6.79% +0.02 0.00 15 Yr. Fixed 5.99% +0.01 0.00 30 Yr. FHA 6.30% +0.02 0.00 30 Yr. Jumbo 6.87% 0.00 0.00 7/6 SOFR ARM 6.33% -0.06 0.00 30 Yr. VA 6.31% +0.02 0.00 Updates Daily - Last Update: 7/10 15 Yr. Fixed Rate 5.99% +0.01% Rate Change Points Freddie Mac 30 Yr. Fixed 6.72% +0.05 0.00 15 Yr. Fixed 5.86% +0.06 0.00 Updates Weekly - Last Update: 7/10 Rate Change Points Mortgage Bankers Assoc. 30 Yr. Fixed 6.77% -0.02 0.62 15 Yr. Fixed 6.04% -0.02 0.63 30 Yr. Jumbo 6.69% -0.09 0.65 Updates Weekly - Last Update: 7/9 MBS / Treasuries UMBS 30YR 5.5 99.54 -0.02 Price / Yield Change MBS UMBS 5.5 99.54 -0.02 UMBS 6.0 101.33 -0.03 GNMA 5.5 99.83 0.00 GNMA 6.0 101.36 -0.02 Pricing as of: 7/11 3:00AM EST 10 Year US Treasury 4.3642 +0.0174 Price / Yield Change US Treasury 2 YR Treasury 3.872 -0.004 5 YR Treasury 3.940 +0.005 7 YR Treasury 4.135 +0.009 10 YR Treasury 4.364 +0.017 30 YR Treasury 4.887 +0.017 Pricing as of: 7/11 3:00AM EST Latest Video Why this equity strategist says 1.5% on the 10-year signals a problem Long way to go in the 10-year before we get nervous: Investor Strategist on what could move yields higher The Bond Report - February 16, 2021 Around the Web Reuters Stimulus hopes drive Dow to closing peak but interest rate worries loom Reuters Recovery rally drives Dow to new peak Reuters Printed in days, a house: New York firm takes 3D printing to the next level CNBC Biden extends protections for homeowners. Here's what you need to know CNBC Bulk of jobless claims are due to repeat pandemic layoffs, say researchers Reuters Stocks rise, bonds sell off as the 'reflation' trade gathers pace CNBC Fed's Bullard doesn't see asset bubble and doubts policy will tighten soon Calculated Risk Blog NY Fed: Manufacturing: Business activity "grew modestly" in New York State in February Calculated Risk Blog Seven High Frequency Indicators for the Economy CNBC 30-year Treasury yield holds above 2% following Presidents Day Reuters Cheap old homes draw U.S. millennials escaping pandemic cages Reuters Draghi forms new Italian govt., names politicians, technocrats as ministers Calculated Risk Blog Hotels: Occupancy Rate Declined 30.5% Year-over-year

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