MBS trading is drifting lower in a rising rate environment, but the outlook remains cloudy as mortgage bankers wonder how many more months they have left before refis drain for good. Or will they?
Mortgage trading narrowed this spring at a time when rates were rising. Lo-and-behold, rates are headed south once again. But inflation fears are accelerating. What’s an MBS owner to do?
The enterprise said 544 loans from uniform MBS pools and 677 loans from mega/super pools were erroneously liquidated due to a servicer’s error. Investors in the securities have the option to pursue claims.
While Fannie began accepting single-family SOFR-indexed ARMs in Au-gust, it stopped taking LIBOR-indexed mortgages at the end of September. By the end of the year, the enterprise will no longer issue LIBOR-linked MBS.
Recent uncertainty surrounding equities drove investors into bonds, especially agency MBS. One result: The average daily trading volume in agency product climbed to a multi-month high in August.
As investors sift through the tea leaves of the bond market, the average daily trading volume in agency MBS increased 11% in July from the month prior. But where we go from here is anyone’s guess.