More records were set as the week commenced along lower coupon MBS and 10-year Treasury note yields as a result of global growth and eurozone worries.

By midweek, however, the risk-on trade was finally seeing a return after encouraging remarks from the European Central Bank President Mario Draghi and some better-than-expected domestic economic reports, particularly on GDP, which saw the advance second quarter read slightly better than expectations at +1.5% while first quarter results were revised to +2.0% from +1.9%. At midday on Friday, prices on 30-year FNMA 3.0% through 4.0% coupons were down nearly 3/4 to 1/4 point from their highs.

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