Last week should have been relatively uneventful. The market stayed within a narrow range with the limited economic news as well as a short trading week. In mortgages, there was the added anticipation that originators would be on the lighter side as many were attending the Mortgage Bankers Association National Secondary Market Conference and Expo in New York.
That wasn't the case, however, as the market steadily sold off. While the early part of the week contained no economic releases, the stock market continued to set new records and higher global rates were also weighing on the bond market. Thursday's better-than-expected increases in new home sales and durable goods orders supported the notion that the Federal Reserve will not be cutting rates anytime soon. In the first three trading days of last week, the 10-year Treasury lost 17+/32nds, while the yield rose 7.1 basis points to 4.859%. The yield level is the highest it's been since late January. Meanwhile, the 2s/10s curve reverted from slightly inverted to a steeper climb by Wednesday's close at 1.4 basis points.