Mortgage Rates Rapidly Recover This Week’s Losses

One of the upsides of these weeks with boring, sideways movement in the rate market is that it doesn’t take much of an improvement to undo several days of damage.  Today brought just such an improvement, and not for any compelling or interesting reasons either! The average lender began the day at lower levels–already close to the best levels of the week.  But as the bond market improved throughout the day, most lenders were able to make mid-day changes to their rate offerings.  After incorporating those changes into our daily average, it easily dropped to the best levels of the week. Volatility could increase slightly next week amid the presence of much more economic data.  The MOST relevant data won’t show up until the first week of March, however, and that’s when volatility risks are the highest, for better or worse.

Without Any Domestic Data on Tap, Bonds Taking Cues From Europe

It was destined to be a mostly boring, sideways week (to whatever extent “destiny” actually has any predictive value).  Perhaps it’s more fair to say that “boring and sideways” is the least surprising outcome in light of the incredibly sparse event calendar.  European data and policy speeches have been in far greater supply, generally hurting bonds on Wednesday and now helping today.  The net effect restores Treasuries to Wednesday AM levels and sets the week on track to end almost perfectly unchanged vs last week.

Strong Friday For Bonds Helps Keep Sideways Vibes Intact

Strong Friday For Bonds Helps Keep Sideways Vibes Intact

Friday ended up being surprisingly strong for the bond market with the best rally of the week in the long end of the yield curve.  European bonds were a key consideration early, but the quarterly rollover in Treasury futures probably added some emphasis to the gains.  10yr Treasuries fully erased the sharper losses seen Wednesday and Thursday.  Unfortunately, those sharper losses happened to be threatening the technical ceiling at 4.32%, so Friday’s rally is best described as merely keeping the broader sideways vibes intact.

Market Movement Recap

10:01 AM Slightly stronger overnight with additional gains in early trading.  MBS up 6 ticks (.19) and 10yr down 3.4bps at 4.297.

01:35 PM Steady gains all morning.  Fed comments not hurting.  10yr down 8.5bps at 4.246.  MBS up 3/8ths. 

03:16 PM Sideways near best levels with MBS up nearly 3/8ths and 10yr down 7.1bps at 4.26

Hedging, Guideline Search, VOI and VOE Tools; Rocket Earnings; Events and Training

“Alexa, where’s my damn package?” (Page down 3-4 times to the video.) Life is full of surprises, good and bad. Rates aren’t a surprise… The U.S. Federal Reserve can only do so much about inflation. Geo-politics are a big deal, of course, and there is nothing our Fed, tasked with maintaining economic stability in this country, can do about those. Vendors and lenders are doing what they can, cutting over-capacity and expenses. Capital markets staffs everywhere are interested in which investors have pushed out the $2,500 Freddie and Fannie month-old HomeReady credit, as well as non-QM, jumbo, co-issue, and servicing buyers. (STRATMOR’s current blog is titled, “It’s 2024: Do You Know Where Your Servicing Is?”) Speaking of capital markets, today’s TMC Rundown features Mutual of Omaha’s Matt Nyman. (Found here, this week’s podcast is sponsored by Truv. Truv lets applicants verify income, employment, assets, insurance, and switch direct deposits. Unlock the power of open finance, with Truv. Today’s has an interview with Verisk’s Kingsley Greenland on servicing for climate risk and technology solutions.) Lender and Broker Services, Products, and Software Mortgage lenders using Empower, the loan origination system (LOS) by Dark Matter Technologies, rejoice! TRUV and Dark Matter bring consumer-permissioned VOI & VOE to the Empower® LOS, reducing costs by 60-80 percent, accelerating loan cycles, and creating a better borrower experience. TRUV brings the best-in-class coverage and conversion directly from the source to your Empower LOS for income and employment verifications. Ask one of us to see a demo of TRUV in Empower® LOS!