March 4th, 2024 9:13 AM by Richard Sardella MLO.100007700/NMLS 233568
The 10 year note at 8:30 am ET 4.23% +5 bps after declining 8 bps Friday and settled at a new low from the last three weeks. MBSs +25 bps Friday, this morning at 8:30 am -17 bps. No follow through from the improvements.
There isn’t anything on the calendar today, but the rest of the week has a few key reports. The prime focus, Jerome Powell’s semi-annual testimony to Congress; Wednesday at the House Financial Services Committee, Thursday at the Senate Banking Committee, Feb employment data on Friday.
Last Thursday’s February PCE inflation data was right on expectations, offsetting the increase seen on the CPI data, Friday rates declined, the 10 breaking below its three-week low to 4.18%. This morning with Jerome Powell testimony and February employment day rates inched higher.
Powell isn’t likely to override all the Fed officials’ comments recently, but his answers to question are key. Expect him to confirm what other Fed officials have said, the Fed is looking at incoming data as to when it will begin cutting rates and reaffirm the Fed is in no rush to cut until inflation is definitely declining. The present consensus in markets, three cuts this year beginning at the June FOMC meeting. Fed comments recently center on waiting for more data to confirm inflation is abating, and less likely to increase. Recent inflation reports showing a mixed picture. Powell will likely accentuate that outlook. Members of Congress may press him on the expanding US debt and how it can be paid, increasing thoughts funding the debt using more short-term securities.
Beside Powell this week there are a few Fed officials speaking, not likely to conflict with what Powell has to say. The calendar has a lot to digest, employment, inflation from productivity and unit labor costs, JOLTS job openings, weekly jobless claims.
At 9:30 am the DJIA opened -154, NASDAQ -21, S&P -6. 10 year note 4.23% +5 bps. FNMA 6.0 30 year coupon at 9:30 am -11 bps from Friday’s close and +13 bps from 9:30 am Friday.
PRICES @ 10:00 AM
10 year note: 4.21% +3 bp
5 year note: 4.19% +3 bp
2 year note: 4.59% +4 bp
30 year bond: 4.35% +2 bp
30 year FNMA 6.0: @9:30 am 100.50 -11 bp (+13 bp from 9:30 am Friday)
30 year FNMA 6.5: @9:30 am 101.79 -8 bp (+10 bp from 9:30 am Friday)
30 year GNMA 5.5: @9:30 am 99.45 -9 bp (+17 bp from 9:30 am Friday)
Dollar/Yuan: $7.1993 +$0.0025
Dollar/Yen: 150.45 +0.32 yen
Dollar/Euro: $1.0856 +$0.0015
Dollar Index: 103.84 -0.02
Gold: $2,106.50 +$10.80
Bitcoin: 66,292 +3,498
Crude Oil: $80.16 +$0.19
DJIA: 39,006 -81
NASDAQ: 16,239 -35
S&P 500: 5132 -5
Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.
All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.
MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.