MBS RECAP: Record High MBS Prices, Record Low Rates. What Next?

Posted To: MBS Commentary

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 Market Movement Recap 08:13 AM Bonds generally improved in the overnight session as stocks lost ground. 10yr yields were as low as .661, but are now back up to .671 in quiet trading. MBS are roughly unchanged to start. 10:02 AM Initial strength in bonds remains, but MBS are outperforming. Last night's prepayment speed report could have something to do with that. UMBS 2.0 coupons are up 6 ticks…(read more)

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