Snowball Selling Pushes 10yr Toward 2.4%, Mortgage Rates to High 4's
The global market jumped on the bandwagon of Fed policy "repricing"--a short word for the process of adjusting today's interest rates to reflect a Fed rate hike campaign that now includes 2 consecutive 50bp hikes in the next 2 Fed meetings as opposed to the 25bp hikes previously seen as ironclad. Domestic traders had no reason to fade the move, especially with stocks rising more than 1% (in other words, only rates are freaked out by Powell and his kettle of ultra hawkish hawks).
Fed MBS Buying 10am, 11:30am, 1pm
More weakness overnight as rate hike expectations continue to ramp up. 10yr up 5bps at 2.348 and 3.5 UMBS down a quarter point at 100-00.
MBS sold off heading into the 10am hour, but have bounced back to AM levels, still down a quarter point. 10yr is up 7bps at 2.368% after being as high as 2.39%. No new market movers in play, just momentum.
Fairly calm and somewhat resilient after initial morning weakness. MBS at highs of the day, down "only" 6 ticks (.19). 10yr yield up "only" 7bps, in line with lowest levels since 9am (2.366).
Back toward weaker levels in the last hour of trading with MBS down 12 ticks (.375) and 10yr yields up 9bps to 2.386.