17 Mar A Huge Drop Before the Fed Meeting
Despite it being St Patrick’s day, Mortgage Backed Securities are in the red, not the green. Down 34 bps this morning, waiting for word from the Fed meeting which will be released around noon MST. Like we talked about earlier this week, the bond market really needs some support from the Fed after the ECB’s weak response to quantitative easing and nonchalance around inflation. Otherwise, inflation concerns will continue to deteriorate pricing. US treasury yields broke through yesterdays ceiling and are now at the highest level since January 2020. We are holding a locking bias going into the Fed meeting as any news other than strong support for the bond market is bad news for mortgage pricing.
Have a great day everyone.