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Evidence For a Ceiling Continues to Accumulate
All the normal disclaimers are in order:
- This is a rising rate environment until proven otherwise. - Floating is best thought of as an intraday endeavor. - Things can always change very quickly. - Any notion of a ceiling is best measured in days and weeks for now.
And the list goes on. With the disclaimers out of the way, we can talk about the mounting evidence for a consolidation that puts an end to the rising rate trend of early 2021. Today may be the first day where it makes any sense to do so, even if it falls well short of making any guarantees.
Econ Data / Events
Fed MBS Buying 10am, 1130am, 1pm
Market Movement Recap
08:29 AM Bonds added to yesterday's late-day strength with a bit of follow-through in Asia. EU bonds were weaker at the open and pulled TSY yields slightly higher, but not out of positive territory. 10yr down 1.2bps at 1.695 and 2.5 UMBS up 2 ticks (+0.06).
11:12 AM Tentative, early gains giving way to better mid-day gains. Fed's Treasury buying operation may have helped. There are also a few decently-sized block trades reported through CME, with one recent example possibly helping drive additional strength. 10yr yields down 4bps at 1.66+. MBS are up a quarter point.
01:42 PM Bonds have been sideways near the day's best levels since the last update (2.5 hours, give or take) but with MBS underperforming just slightly. 2.5 coupons are 3 ticks (.09) lower over that time, but still up more than an eighth of a point on the day.
04:00 PM MBS-specific weakness ended shortly after the last update and they joined Treasuries in an afternoon sideways grind at or near the day's best levels. Essentially all of today's gains could be chalked up to tradeflows and technicals (i.e. bonds are not reacting to any new news).
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MBS Commentary
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Evidence For a Ceiling Continues to Accumulate
All the normal disclaimers are in order:
- This is a rising rate environment until proven otherwise. - Floating is best thought of as an intraday endeavor.&nbs... (read more) |
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Housing News
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Does staging really work? That was among the home buying and selling topics covered in a new survey from the National Association of Realtors® (NAR) and the answer appears to be "yes." Eight-two percent of buyers' agents said home staging made it... (read more) |
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Housing News
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CoreLogic's February Home Price Index (HPI) essentially echoed that the price report last week from Black Knight. The company said that its index recorded its highest annual growth since 2006 at 10.4 percent. Demand continues to clash with an histori... (read more) |
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Housing News
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Fannie Mae says results from its fourth quarter 2020 National Housing Survey show that consumers continue to view homeownership as a good investment. Respondents were asked about various investment types, including stocks, bonds, homes, and savings a... (read more) |
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Rob Chrisman
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For some good news, any company that holds or buys servicing has seen their balance sheet improve with the rise in mortgage rates. For more good news, reverse mortgage lenders are licking their chops over the news that homeowners, aged 62 and older, ... (read more) |
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Mortgage Rate Watch
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Mortgage rates have been trying to find a ceiling in the past 3 weeks after rising at the quickest pace in years. That search seemed to be going well until late last week when rates failed to break below the floor that's blocked other recent attempts... (read more) |
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