A recurring rumor surfaced again last week after a senior Federal Reserve official reiterated the possibility that the Fed is looking into adding Ginnie Maes to its own account, the System Open Market Account (SOMA). Ginnie MBS strengthened on the news, relative to Fannie Mae and Freddie Mac mortgage-backed bonds, said MBS analysts.

This is the first time that the topic was broached openly since last summer, when the Fed announced that it was studying the possibility of using GNMAs in the Fed's SOMA as a substitute for Treasurys.

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