Heavy originator supply has yet to materialize within the mortgage sector, although a couple of trading sessions last week saw about $2 billion of selling, but the remainder of the week saw limited trading between $500 million and $750 million per day. At the same time, the MBS sector experienced steady buying from banks, money managers, arbitrage accounts, and dealers, helped by continued steepness in the yield curve.

In particular, last week saw better activity in 7s and premium coupons due to 48-hour settlement for 30-year conventional RMBS, and from the modest back up in yields. Overall, spreads closed the week two to three basis points wider versus Treasuries.

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.