Dealers and MBS traders noted a "delayed reaction" to the 50-basis-point Fed rate cut last Wednesday, as the FOMC move was, for the most part, already priced into the market.

"Overall, mortgages have done well, especially the 15-year sector," said David Montano, director of mortgage-backed research at Credit Suisse First Boston. "The overall market gradually rallied this time around, and 6.5% coupons were trading above parity."

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.