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2nd December, 25
Steady Gains Throughout The Day
Steady Gains Throughout The Day Bonds began the day in modestly weaker territory although MBS were fairly quick to get back to 'unchanged' while 10yr Treasuries couldn't duplicate that feat until the afternoon. There were no clear correlations with other markets and no notable risks on the econ calendar. The gains were slow and steady enough to suggest an absence of discrete catalysts. That could change on Wednesday with the confluence of ADP and ISM Services--both capable of influencing the bond market, even before the shutdown data dynamics temporarily magnified private data's importance.
Steady Gains Throughout The Day
Steady Gains Throughout The Day Bonds began the day in modestly weaker territory although MBS were fairly quick to get back to 'unchanged' while 10yr Treasuries couldn't duplicate that feat until the afternoon. There were no clear correlations with other markets and no notable risks on the econ calendar. The gains were slow and steady enough to suggest an absence of discrete catalysts. That could change on Wednesday with the confluence of ADP and ISM Services--both capable of influencing the bond market, even before the shutdown data dynamics temporarily magnified private data's importance.
2nd December, 25
Mortgage Rates Move Slightly Lower
Unlike Monday, which saw a fairly brisk move toward higher rates, Tuesday barely budged. Additionally, the budging occurred in a friendly direction with the average lender offering rates that were just a hair lower than yesterday's. Starting tomorrow morning, this week's potential volatility will be higher. Each day brings several economic reports with the power to push rates higher or lower. Wednesday/tomorrow is probably chief among these due to the ADP employment report and a closely watched service sector report from ISM.
Mortgage Rates Move Slightly Lower
Unlike Monday, which saw a fairly brisk move toward higher rates, Tuesday barely budged. Additionally, the budging occurred in a friendly direction with the average lender offering rates that were just a hair lower than yesterday's. Starting tomorrow morning, this week's potential volatility will be higher. Each day brings several economic reports with the power to push rates higher or lower. Wednesday/tomorrow is probably chief among these due to the ADP employment report and a closely watched service sector report from ISM.
2nd December, 25
Jumbo, Processing, AI, 2nd Products; Current State of M&A and Partnerships
I don’t know about you, but a hot shower or bath always sounds good. Tech wizards, however, have created a human washing machine. I’ll pass. At this point it would be impossible to do a home loan without “technology,” and AI is all the rage. For those trying to figure out how to think about AI, or even where to start, this month’s STRATMOR piece is titled, “Artificial Intelligence in Mortgage Lending.” Should an AI loan officer be licensed? In artificial intelligence, “agentic” AI focuses on “autonomous systems that can make decisions and perform tasks with limited or no
Jumbo, Processing, AI, 2nd Products; Current State of M&A and Partnerships
I don’t know about you, but a hot shower or bath always sounds good. Tech wizards, however, have created a human washing machine. I’ll pass. At this point it would be impossible to do a home loan without “technology,” and AI is all the rage. For those trying to figure out how to think about AI, or even where to start, this month’s STRATMOR piece is titled, “Artificial Intelligence in Mortgage Lending.” Should an AI loan officer be licensed? In artificial intelligence, “agentic” AI focuses on “autonomous systems that can make decisions and perform tasks with limited or no
2nd December, 25
MBS Outperforming Longer-Term Treasuries
The early days of a new trading month and the positioning ahead of next week's Fed announcement have resulted in clear curve trading biases. In English, this means that shorter-term Treasuries are doing much better than longer-term Treasuries. For example, 2yr yields are down 2.4bps while 10yr yields are up 1.1bps. This dynamic is usually good for MBS because the average implied duration for MBS is closer to 5 years than 10 these days. The result: MBS and 5 year Treasuries are both slightly stronger on the day while 10s are still slightly weaker.
MBS Outperforming Longer-Term Treasuries
The early days of a new trading month and the positioning ahead of next week's Fed announcement have resulted in clear curve trading biases. In English, this means that shorter-term Treasuries are doing much better than longer-term Treasuries. For example, 2yr yields are down 2.4bps while 10yr yields are up 1.1bps. This dynamic is usually good for MBS because the average implied duration for MBS is closer to 5 years than 10 these days. The result: MBS and 5 year Treasuries are both slightly stronger on the day while 10s are still slightly weaker.
1st December, 25
Complete Silence After AM Volatility
Complete Silence After AM Volatility Bonds were mostly flat overnight before a sharp sell-off from 8am through 10am ET. After that, momentum went flat again--especially the last 4 hours of trading. No one is still debating whether or not the AM sell-off was due to Japan's central bank news or a post-holiday return to reality. Yields are back in the pre-Thanksgiving range and ready to respond to this week's bigger-ticket econ reports. Econ Data / Events ISM Manufacturing Employment (Nov) 44.0 vs -- f'cast, 46.0 prev ISM Manufacturing PMI (Nov) 48.2 vs 48.6 f'cast, 48.7 prev ISM Mfg
Complete Silence After AM Volatility
Complete Silence After AM Volatility Bonds were mostly flat overnight before a sharp sell-off from 8am through 10am ET. After that, momentum went flat again--especially the last 4 hours of trading. No one is still debating whether or not the AM sell-off was due to Japan's central bank news or a post-holiday return to reality. Yields are back in the pre-Thanksgiving range and ready to respond to this week's bigger-ticket econ reports. Econ Data / Events ISM Manufacturing Employment (Nov) 44.0 vs -- f'cast, 46.0 prev ISM Manufacturing PMI (Nov) 48.2 vs 48.6 f'cast, 48.7 prev ISM Mfg
1st December, 25
Mortgage Rates Erase Last Week's Gains
Mortgage rates are based on bonds and the bond market is prone to erratic behavior on major holiday weeks. One of the more common patterns is for the holiday week to see a noticeable departure from a prevailing trend only to return to that trend in the following week. That's exactly what we're seeing on the first day of the new week. The prevailing trend saw rates hold a narrow, sideways range with the average top tier 30yr fixed rate in the 6.3s. Last week saw that average drop to 6.20% and now today, we're right back up to 6.31%. [thirtyyearmortgagerates] In the coming days,
Mortgage Rates Erase Last Week's Gains
Mortgage rates are based on bonds and the bond market is prone to erratic behavior on major holiday weeks. One of the more common patterns is for the holiday week to see a noticeable departure from a prevailing trend only to return to that trend in the following week. That's exactly what we're seeing on the first day of the new week. The prevailing trend saw rates hold a narrow, sideways range with the average top tier 30yr fixed rate in the 6.3s. Last week saw that average drop to 6.20% and now today, we're right back up to 6.31%. [thirtyyearmortgagerates] In the coming days,
1st December, 25
DSCR, Non-QM, FHA Products; AI, Broker, Borrower-Focused Webinars; STRATMOR on 2026 Growth Areas
A buddy from Kentucky wrote to me, saying, “Statistics show that the average person has sex 89 times per year. Looks like I'm in for a pretty wild December.” November is behind us, and with it all the noise about President Trump’s 50-year mortgage proposal. Capital markets personnel in the mortgage biz don’t like thinking about how long it would take to create a market for 50-year mortgages, nor do they like volatility, but traders do. The mood among traders has swiftly improved, chiefly due to economic data that has supported an interest rate cut in December. The Federal Reserve’s
DSCR, Non-QM, FHA Products; AI, Broker, Borrower-Focused Webinars; STRATMOR on 2026 Growth Areas
A buddy from Kentucky wrote to me, saying, “Statistics show that the average person has sex 89 times per year. Looks like I'm in for a pretty wild December.” November is behind us, and with it all the noise about President Trump’s 50-year mortgage proposal. Capital markets personnel in the mortgage biz don’t like thinking about how long it would take to create a market for 50-year mortgages, nor do they like volatility, but traders do. The mood among traders has swiftly improved, chiefly due to economic data that has supported an interest rate cut in December. The Federal Reserve’s
1st December, 25
Breaking Down Early Weakness. Is It Japan?
Bonds are sharply weaker to begin the new week and the new month. This is the first (and probably best) clue as to the nature of this morning's market movement. Thanksgiving weeks are prone to random volatility and today's selling basically erases the entirety of last week's movement. Then there's the Bank of Japan's comments on considering rate hikes at the next meeting. Past examples of policy shifts in Japan are burned into the memory of US markets as the source of several large, surprising reactions in bonds. Today's example is getting attention because there's nothing more obvious to
Breaking Down Early Weakness. Is It Japan?
Bonds are sharply weaker to begin the new week and the new month. This is the first (and probably best) clue as to the nature of this morning's market movement. Thanksgiving weeks are prone to random volatility and today's selling basically erases the entirety of last week's movement. Then there's the Bank of Japan's comments on considering rate hikes at the next meeting. Past examples of policy shifts in Japan are burned into the memory of US markets as the source of several large, surprising reactions in bonds. Today's example is getting attention because there's nothing more obvious to
28th November, 25
Mortgage Rates Unchanged Versus Wednesday
As is most often the case, the Friday after Thanksgiving added nothing interesting to mortgage rate momentum. The average lender's top tier 30yr fixed rate is exactly where it was on Wednesday. The underlying bond market closes early today, but will be fully open next week. At that point, we're likely to see some volatility return for rates, depending on the results of economic reports.
Mortgage Rates Unchanged Versus Wednesday
As is most often the case, the Friday after Thanksgiving added nothing interesting to mortgage rate momentum. The average lender's top tier 30yr fixed rate is exactly where it was on Wednesday. The underlying bond market closes early today, but will be fully open next week. At that point, we're likely to see some volatility return for rates, depending on the results of economic reports.
28th November, 25
Open But Not Really Open
Open But Not Really Open This is just a reminder that the Friday after Thanksgiving is the most useless and inconsequential trading day of the year. In very rare cases, movement can be tied to actual events/data, but that's not the case today. We do not publish detailed commentary on this particular Friday unless something interesting is happening. We're only publishing this to let you know we're watching and still not seeing anything interesting. Market Movement Recap 10:03 AM sideways overnight and modestly weaker so far. MBS down 2 ticks (.06) and 10yr up 1.7bps
Open But Not Really Open
Open But Not Really Open This is just a reminder that the Friday after Thanksgiving is the most useless and inconsequential trading day of the year. In very rare cases, movement can be tied to actual events/data, but that's not the case today. We do not publish detailed commentary on this particular Friday unless something interesting is happening. We're only publishing this to let you know we're watching and still not seeing anything interesting. Market Movement Recap 10:03 AM sideways overnight and modestly weaker so far. MBS down 2 ticks (.06) and 10yr up 1.7bps