Recap:
Yesterday saw mortgage bonds hit their worst levels right at 9:30 and improve a bit rolling into 10:00 am Eastern Time as most lenders start to set pricing. Bonds had some slow improvement until around 11:00 am and then basically held that until 1:00 pm, when they jumped again and improved a little bit further. We can give some credit for the 1 pm improvement to the 10-year Treasury auction, which had strong demand, but the FOMC meeting minutes didn't seem to make much of a difference at all at 2 pm. Overall, tt was quite the volatile day, seeing bonds improve about 25 basis points from worst levels up to best levels where they ended the day, with quite a few lenders that did reprice better. Overall, though, it still hardly made a dent in rates, with most rate sheets still near the highest levels for the year.
Another day where bonds fought back in the afternoon to end the day basically unchanged. Quite a few reprices better, and once again I'd take that money and run. Bottom line, today is no better than yesterday and for most rate sheets it is worse. Nothing of merit on the calendar tomorrow, not likely bonds improve much more but let's see what tomorrow brings.
Rate outlook for today...
Rate sheet's likely to be about the same as yesterday, maybe a bit better for lenders who didn't reprice. Reprice risk today is low, although we're seeing quite a bit of volatility these days it will take more than usual to get most lenders to send out new rate sheets.
Jobless claims fell once again last week, continuing to show a strong labor market with little layoffs. There's really not much else to pay attention to today. Markets have been listening to Fed Waller talk about the need to raise rates but that there is "flexibility" in the timing and pace and the Fed doesn't need to raise at consecutive meetings (this helps remove pressure from a rate hike at this month's meeting).
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