MBS Week Ahead: Holding a Narrower Range as Jobs Report Approaches

Posted To: MBS Commentary

This week brings good potential for volatility as Friday represents the confluence of several individual events that are normally worth some volatility on their own. The jobs report, the start of trading for a new month, the last day of trading before a 3-day weekend, and perhaps even a breakout from the recently narrow range in the bond market (1.44-1.53% 10yr yield). As far as that range is concerned, it received some reinforcement this morning as yields bounced back down after moving up to the range ceiling on Friday. In general, the ceiling is weaker than the floor in this case as 1.53 doesn't have a recent track record of supportive bounces in the same way that 1.44 has offered resistance bounces. If these boundaries can remain intact by Friday, it increases the potential for a breakout…(read more)

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Source: Mortgage News Daily

MBS RECAP: Small, Defensive Shift Heading Into The Weekend

Posted To: MBS Commentary

Small, Defensive Shift Heading Into The Weekend The highest core inflation in decades proved to be no big deal this morning. In fact, bonds rallied. Unfortunately, that set up for a technical selling opportunity as traders pared long positions heading into the weekend. The selling stalled right at the 1.53% technical level in 10yr yields. We'll hope that ceiling continues to hold and we'll send out another alert if it doesn't (provided MBS are following suit). Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Core PCE y/y 3.4 vs 3.4 f'cast, 3.1 prev Consumer Sentiment 85.5 vs 86.5 f'cast, 86.4 prev 1yr inflation expectations down 0.4% from May 5yr inflation expectations down 0.2% from May Market Movement Recap 08:42 AM Stocks and bonds both popped modestly stronger after…(read more)

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Source: Mortgage News Daily

Senior Management, AE, MLO, Ops Jobs; Corresp., Sales, Warehouse Products; Agency Changes Continue

Posted To: Pipeline Press

As lenders are working on adjusting margins, best-ex, and staffing, while at the same time relieved that rates haven’t gone up and pipelines are motoring along, the industry continues to consider the ripple effects of Director Mark Calabria’s departure from running the FHFA, ergo Freddie and Fannie, and the news of the nominee Sandra Thompson contained in this statement . (And quite the bio !) Sasha Hewlett, Director, Secondary & Capital Markets with the Mortgage Bankers Association, wrote, “We have priorities for new incoming leadership that include things that can ease the disruptions caused by the PSPA issues. That being said, while there are immediate steps we’ll be asking new FHFA leadership to take to alleviate the market disruptions, any actual revisions to the…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Highest Core Inflation in Decades? No Big Deal

Posted To: MBS Commentary

Much like the CPI data 2 weeks ago, today's PCE data showed the highest core inflation in decades. In fact, we'd have to go back almost 3 decades when inflation was still in the process of returning to earth after its aberrant spike in the 80s to see anything higher. And much like 2 weeks ago, the bond market is yawning with disinterest. If there's a reason for this, it's that insanely high inflation readings are the norm right now and today's particular result fell right in line with the forecast. Markets are looking ahead to covid-related supply chain disruptions having less of an effect on prices. That's when we'll see how much of this inflation spike is truly transitory. Between now and then, markets are more interested in focusing on other big-ticket economic…(read more)

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Source: Mortgage News Daily

MBS RECAP: Bonds Snooze Through Data and Infrastructure Bill

Posted To: MBS Commentary

Bonds Snooze Through Data and Infrastructure Bill The day began with a morning of lackluster econ data being met with a yawn from the bond market. A few hours later, the long-awaited infrastructure bill finally arrived to a similarly lukewarm reception. As expected, it took a long time and was ultimately pared down significantly. With markets having already done so much to prepare, there was nothing left to do but hit snooze again. Finally, the 7yr Treasury auction wasn't nearly interesting enough for bonds to get out of bed. Trading levels were basically flat for the entire day. Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Jobless Claims 411k vs 380k f'cast, 418 prev Durable Goods 2.3 vs 2.8 f'cast. (previous reading revised to -0.8 from -1.3) Core Cap-Ex -0.1 vs 0.6 f'cast…(read more)

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Source: Mortgage News Daily

Biden Appoints New FHFA Director

Posted To: MND NewsWire

The White House didn’t waste any time after a Supreme Court ruling allowed it to do so, removing Mark Calabria as Director of the Federal Housing Finance Agency (FHFA) late Wednesday. Earlier that day the Court had released their 7-2 ruling that the inability to remove the agency director during a five year term except for cause was a violation of the Constitution’s separation of powers. As it was speculated it would, the White House has now announced the appointment of Sandra L. Thompson as the Acting Director of FHFA . Thompson has served as Deputy Director of FHFA’s Division of Housing Mission and Goals (DHMG) since 2013. In this position she has overseen the agency’s housing and regulatory policy, capital policy, financial analysis, fair lending and all mission activities for Fannie Mae…(read more)

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Source: Mortgage News Daily

MLO, Ops Jobs; Loan Sales, Presentation, Social Media Compliance, Workflow Tools; FHFA Leadership Change: Now What?

Posted To: Pipeline Press

In case you haven’t heard, the Supreme Court ruled that a U.S. president can remove the head of Federal Housing Finance Agency, in this case, Mark Calabria (who has his thoughts on the decision ). Plenty of lenders ask, “What now? Who will replace him, perhaps an economist who knows our business? And when will some of the measures Director Calabria put in place be rolled back?” There are some who will tell you that anything put in place by him can be scaled back or eliminated but anything in conjunction with other entities, like the U.S. Treasury, will take some time to change. (It is thought that Director Calabria pretty much wrote the January stock amendment, and the Treasury put a rubber stamp on it. This Amendment launched the NOO/2nd home caps, which have since caused…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Bonds Continue Waiting For Their Favorite Indicators

Posted To: MBS Commentary

This week's supply of economic data is rapidly dwindling and we've yet to see a bond market reaction worth writing home about. This morning's crop provided the most recent example. If the market's recent willingness to look past short-term inflation spikes is any indication, Friday may not be much different. That only increases the focus on next week's bigger-ticket data (specifically nonfarm payrolls on Friday). It's important to keep the context in mind though. We've moved on from the big-picture questions from the spring. At that time, rates were leveling off after adjusting abruptly higher on a combination of Treasury issuance and eventual Fed tapering. The early summer months brought an opportunity for the Fed to clarify its stance in light of improving economic…(read more)

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Source: Mortgage News Daily

Mortgage Rates Edge Down to Best Levels in a Week

Posted To: Mortgage Rate Watch

Last week’s announcement from the Federal Reserve was the last major shake-up for mortgage rates , sending them quickly higher on Wednesday afternoon. Since then, things have been improving gradually , even if a bit unevenly. Mortgage lenders have been hoping for a little more stability, and today they got it. The bonds that underlie mortgage rates had their most stable day since before the Fed meeting and they also managed to do that while trading at or near the best levels over the same time frame. The result is the lowest mortgage rates since last Wednesday morning for the average lender. All that having been said, today’s movement was small compared to last Wednesday. It’s taken a string of small gains to equal HALF of the damage done on Wednesday afternoon. In other words, we may be at…(read more)

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Source: Mortgage News Daily

New Home Sales Hit 12 Month Low Despite Higher Inventory

Posted To: MND NewsWire

New home sales dropped for the second month in May, falling below an 800,000 unit pace for the first time in a year. The U.S. Census Bureau and the Department of Housing and Urban Development said newly constructed homes sold at a seasonally adjusted annual rate of 769,000 units. This was a decline of 5.9 percent from the downwardly revised (from 863,000) rate of 817,000 in April. May sales only outpaced those a year earlier by 9.2 percent, well below the double digit annual increases of the last few months. The results fell more than 100,000 units short of the consensus forecast of analysts polled by Econoday. They had expected sales in the range of 840,000 to 920,000 with a consensus of 881,000 units. On a non-adjusted basis, sales fell from 75,000 homes to 69,000 month-over-month. For the…(read more)

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Source: Mortgage News Daily