Mortgage Rates Bounce Slightly Higher
MBS Outperform as Treasuries Get Hit by Issuance
By 4pm, 5.0 MBS are only down a hair over an eighth of a point, and had bounced back by more than quarter point from mid-day lows. Treasuries, on the other hand, were still up 8bps in yield, and close enough to their weakest levels of the day. The latter have been hit harder by issuance headwinds. This refers not only to the Treasury auction cycle on the calendar, but also to the more variable landscape of corporate debt, which has a bigger impact on Treasuries vs MBS. Curve trading also continues to weigh on 10s (2yr yields were up only 3bps). In the bigger picture, this just looks
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