Posted To: MBS Commentary
N OTE: Fannie and Freddie 30yr fixed MBS ‘rolled’ over the weekend. The post-roll price of Fannie 3.0 MBS was 102-02. That will look like a 10/32nds sell-off as far as charts are concerned, but prices did not ‘go down for real.’ The 10/32nds drop is and was the difference between the just-retired month (April) of coupons and the current month (May). Traders and secondary desks were already transacting business with the new May coupons. We are simply shifting our frame of reference to the next coupon in line after the previous coupon fell off the conveyor belt. All things being equal, these new, lower MBS prices would slowly work their way back up by the same 10/32nds by the time they’re retired in about a month. The next crop would then be the new representative for “MBS…(read more)
Via:: MBS Week Ahead: MBS Roll; Which Way do We Go?
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