Last week, mortgage activity was rather lethargic. Given the previous week's run-up, investors and analysts turned more neutral, though with a positive tilt due to the attractive carry. Flows were generally two-way and consisted of moving down in coupon. There was continued selling by servicers in 5s and increased interest by a variety of investors in 15-years due to recent underperformance versus 30s as well as better fundamentals and technicals. Originator selling was nearly nonexistent, averaging about $750 million per day.

Over the week, spreads were slightly tighter with the exception of both 30- and 15-year 5.5s, which were flat to wider. Meanwhile, 30-year Fannie Mae 4.5s, and 15-year 4s and 4.5s tightened three basis points.

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