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30th October, 25
Uneventfully Flat After Initial Weakness
Uneventfully Flat After Initial Weakness The bond market only had a little more selling to do thanks to the unpleasant tailwind from Wednesday afternoon's Fed press conference. That said, one could also argue that corporate bond issuance was the source of early weakness. Either way, yields are now back where they would have been in lieu of the Oct 10th tariff announcement and the Oct 16th regional bank drama (the two biggest recent events that pushed them lower). Fed rate expectations for the December meeting are worse off--nearly back to levels seen BEFORE the jobs report that
Uneventfully Flat After Initial Weakness
Uneventfully Flat After Initial Weakness The bond market only had a little more selling to do thanks to the unpleasant tailwind from Wednesday afternoon's Fed press conference. That said, one could also argue that corporate bond issuance was the source of early weakness. Either way, yields are now back where they would have been in lieu of the Oct 10th tariff announcement and the Oct 16th regional bank drama (the two biggest recent events that pushed them lower). Fed rate expectations for the December meeting are worse off--nearly back to levels seen BEFORE the jobs report that
30th October, 25
Mortgage Rates Are Anything But Lower This Week
Every now and then, a Thursday comes along where we have to set the record straight on what is actually going on with mortgage rates. That's because Freddie Mac releases its weekly mortgage rate survey on Thursdays and its methodology can cause confusion in the mortgage market. This particular Thursday is an especially treacherous minefield of misinformation due to the juxtaposition with yesterday's Fed rate cut. There are already too many people out there repeating the faulty notion that the Fed rate cut means lower mortgage rates. Adding fuel to that fire are various headlines
Mortgage Rates Are Anything But Lower This Week
Every now and then, a Thursday comes along where we have to set the record straight on what is actually going on with mortgage rates. That's because Freddie Mac releases its weekly mortgage rate survey on Thursdays and its methodology can cause confusion in the mortgage market. This particular Thursday is an especially treacherous minefield of misinformation due to the juxtaposition with yesterday's Fed rate cut. There are already too many people out there repeating the faulty notion that the Fed rate cut means lower mortgage rates. Adding fuel to that fire are various headlines
30th October, 25
Non-QM Hedging, Best-Ex, Compliance Tools; Webinars and Training; Freddie and Redwood's Earnings
Are you ready to change the time on your car’s clock, or leave it and let it be right again on March 8, 2026? Some technology is cool. Imagine controlling your iPhone entirely with your eyes. (That would really keep me from riding my bike and talking on the phone!) Food delivery robots have human names and blinking eyes. But they’re not our friends any more than the Russians are our allies. Every lender and title company knows that cybercriminals don’t take breaks, and neither do data breaches. The TransUnion breach exposed the personal details of over 4.4 million Americans. If your
Non-QM Hedging, Best-Ex, Compliance Tools; Webinars and Training; Freddie and Redwood's Earnings
Are you ready to change the time on your car’s clock, or leave it and let it be right again on March 8, 2026? Some technology is cool. Imagine controlling your iPhone entirely with your eyes. (That would really keep me from riding my bike and talking on the phone!) Food delivery robots have human names and blinking eyes. But they’re not our friends any more than the Russians are our allies. Every lender and title company knows that cybercriminals don’t take breaks, and neither do data breaches. The TransUnion breach exposed the personal details of over 4.4 million Americans. If your
30th October, 25
Enthusiasm Curbed. Back to Waiting
The simplest way to understand yesterday's post-Fed sell-off is as follows. The market's enthusiasm for 3 Fed rate cuts in 2025 had grown a bit too large for the Fed's liking. The market was nearly 100% certain of another cut in December. The Fed was not as certain, and Powell made it a point to say so yesterday. The result is a mild re-set in yields back to levels that are more consistent with a December cut being a solid possibility, but not a full lock. Now we wait to see if the non-gov econ data tips those scales in one direction or the other. This morning's additional selling
Enthusiasm Curbed. Back to Waiting
The simplest way to understand yesterday's post-Fed sell-off is as follows. The market's enthusiasm for 3 Fed rate cuts in 2025 had grown a bit too large for the Fed's liking. The market was nearly 100% certain of another cut in December. The Fed was not as certain, and Powell made it a point to say so yesterday. The result is a mild re-set in yields back to levels that are more consistent with a December cut being a solid possibility, but not a full lock. Now we wait to see if the non-gov econ data tips those scales in one direction or the other. This morning's additional selling
29th October, 25
Yet Again, Mortgage Rates Surge Higher After Fed Rate Cut
Today was not a foregone conclusion and there was no way to know ahead of time that it would end like this, but the outcome is exactly why we've gone to such lengths to warn you about the potentially paradoxical reaction to a Fed rate cut. Too many people repeat the fallacy that mortgage rates will benefit from a Fed cut. We have several recent examples of the exact opposite happening, and now today adds another strong reminder with the average lender moving higher at the fastest pace since the day after the last Fed meeting. Why does this happen? It has nothing to do with
Yet Again, Mortgage Rates Surge Higher After Fed Rate Cut
Today was not a foregone conclusion and there was no way to know ahead of time that it would end like this, but the outcome is exactly why we've gone to such lengths to warn you about the potentially paradoxical reaction to a Fed rate cut. Too many people repeat the fallacy that mortgage rates will benefit from a Fed cut. We have several recent examples of the exact opposite happening, and now today adds another strong reminder with the average lender moving higher at the fastest pace since the day after the last Fed meeting. Why does this happen? It has nothing to do with
29th October, 25
Another Hawkish Powell Press Conference Harshes Bonds' Mellow
Another Hawkish Powell Press Conference Harshes Bonds' Mellow The Fed cut rates and ended QT. Neither were surprises for markets and neither had an impact. The press conference was hawkish, however, with Powell saying a December cut was far from a foregone conclusion. This is very much counter to the market's expectation that a December cut was a lock. Fed Funds Futures tanked and yields surged about 8bps in the 10yr. MBS lost about 3/8ths and negative reprices continue to roll in. Econ Data / Events Case Shiller Home Prices-20 y/y (Aug) 1.6% vs 1.9% f
Another Hawkish Powell Press Conference Harshes Bonds' Mellow
Another Hawkish Powell Press Conference Harshes Bonds' Mellow The Fed cut rates and ended QT. Neither were surprises for markets and neither had an impact. The press conference was hawkish, however, with Powell saying a December cut was far from a foregone conclusion. This is very much counter to the market's expectation that a December cut was a lock. Fed Funds Futures tanked and yields surged about 8bps in the 10yr. MBS lost about 3/8ths and negative reprices continue to roll in. Econ Data / Events Case Shiller Home Prices-20 y/y (Aug) 1.6% vs 1.9% f
29th October, 25
Here's What Changed in The New Fed Announcement
Recent Available indicators suggest that growth of economic activity moderated in the first half of the year has been expanding at a moderate pace . Job gains have slowed this year , and the unemployment rate has edged up but remains remained low through August; more recent indicators are consistent with these developments . Inflation has moved up since earlier in the year and remains somewhat elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook remains elevated. The Committee is attentive
Here's What Changed in The New Fed Announcement
Recent Available indicators suggest that growth of economic activity moderated in the first half of the year has been expanding at a moderate pace . Job gains have slowed this year , and the unemployment rate has edged up but remains remained low through August; more recent indicators are consistent with these developments . Inflation has moved up since earlier in the year and remains somewhat elevated. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook remains elevated. The Committee is attentive
29th October, 25
What Matters in Today's Fed Announcement
Bonds are a hair weaker this morning with losses showing up in the overnight session and mostly flattening out in domestic trading. Without any big ticket data this morning, this aimless drift is standard operating procedure--especially considering the pre-Fed consolidation was largely assumed to be seen via the modest weakness at the end of last week. That brings us to the Fed this afternoon. Forget the rate cut. That's 100% priced in. Instead, we have two other considerations: Powell's tone at the press conference and the potential inclusion of a change to
What Matters in Today's Fed Announcement
Bonds are a hair weaker this morning with losses showing up in the overnight session and mostly flattening out in domestic trading. Without any big ticket data this morning, this aimless drift is standard operating procedure--especially considering the pre-Fed consolidation was largely assumed to be seen via the modest weakness at the end of last week. That brings us to the Fed this afternoon. Forget the rate cut. That's 100% priced in. Instead, we have two other considerations: Powell's tone at the press conference and the potential inclusion of a change to
29th October, 25
Hedging, HELOC, Servicing Oversight, AI Assisted Branding; Fannie's 31st Consecutive Quarterly Profit
"The U.S. Senate is considering a bill that would tax Botox. When Botox users heard this, they were horrified. Well, I think they were horrified. It's difficult to tell." Is anyone motivated to end the government shutdown? I mean, really motivated? One side sticking to their guns about healthcare, the other side is fine with slowing down the economy to move rates lower. And now we have the expiration of SNAP benefits. The impact on the overall economy seems to be minimal, although we (including the Fed) aren’t receiving the usual stream of government economic data, although we are seeing the
Hedging, HELOC, Servicing Oversight, AI Assisted Branding; Fannie's 31st Consecutive Quarterly Profit
"The U.S. Senate is considering a bill that would tax Botox. When Botox users heard this, they were horrified. Well, I think they were horrified. It's difficult to tell." Is anyone motivated to end the government shutdown? I mean, really motivated? One side sticking to their guns about healthcare, the other side is fine with slowing down the economy to move rates lower. And now we have the expiration of SNAP benefits. The impact on the overall economy seems to be minimal, although we (including the Fed) aren’t receiving the usual stream of government economic data, although we are seeing the
28th October, 25
Modestly Stronger Ahead of Fed Day
Modestly Stronger Ahead of Fed Day Without any market moving econ data on Tuesday, bonds finally managed to find a bid. Or at least that's how it seemed during domestic hours. When considering the overnight session, we actually saw yields hit their lows of the day before the open, sell-off a bit at 8:20-8:40am surrounding a weekly employment update from ADP, and then return to the best levels mid-day. The 7yr auction was slightly weaker, but bonds didn't mind (perhaps just relieved to have supply in the rearview). With tomorrow's Fed cut a 100% certainty, volatility potential
Modestly Stronger Ahead of Fed Day
Modestly Stronger Ahead of Fed Day Without any market moving econ data on Tuesday, bonds finally managed to find a bid. Or at least that's how it seemed during domestic hours. When considering the overnight session, we actually saw yields hit their lows of the day before the open, sell-off a bit at 8:20-8:40am surrounding a weekly employment update from ADP, and then return to the best levels mid-day. The 7yr auction was slightly weaker, but bonds didn't mind (perhaps just relieved to have supply in the rearview). With tomorrow's Fed cut a 100% certainty, volatility potential