Conventional speeds slowed less than expected in February, especially on FHLMC Gold 30-years.  FNMA speeds declined nearly 14% from January versus a projected 18%. Speeds declined in line with projections for 5s and newer 5.5s while speeds on more seasoned 5.5s and higher coupons did not slow as much as anticipated. 

FHLMC Gold speeds fell only 8%, half as much as predicted, as speeds across the stack prepaid better than projected. In particular, 2008-2006 6.5% and 7% vintages increased. The lower decline in FHLMC Gold speeds is probably a result of the increase in FHLMC Gold delivery fees that were effective March 1. This was expected to lead to some front loading of loan closings. FNMA could see a similar impact in the next report as its delivery fees are set to increase April 1.

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