The New York Federal Reserve Bank ramped up its purchase of GSE MBS the past two weeks due to an increase in refinancings and agency issuance of MBS.

MBS issuance by Fannie Mae, Freddie Mac and Ginnie Mae increased to $97 billion in February, compared to $61 billion in January.

A new Credit Suisse report said issuance could reach $130 billion in March. "The Fed's purchases of agency MBS have been very effective in lowering rates, improving liquidity in the market and spurring refis," said CS mortgage strategist Mahesh Swaminathan.

From February 26 through March 11, the New York Fed purchased $57.2 billion in agency MBS compared to $44.9 billion for previous two-week period.

 Meanwhile, Treasury said it purchased $12.7 billion in Fannie and Freddie MBS in February, down from $22.6 billion in January.

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