As expected, prepayments slowed in July primarily due to a lower number of collection days - 20 versus 22 days in June. In general, FNMA speeds were anticipated to slow around 10% in 4.5s and 5s, and 12% to 13% in higher coupons. Speeds declined slightly more than that with the exception of 6s, which were essentially in-line. Analysts from Barclays Capital suggested the slightly greater slowing than expected - particularly in discounts - is also evidence of the weakening in the housing sector.

FHLMC Gold speeds reported similar percentage declines for the most part, though 2005 vintage 6s declined substantially more at 19% versus 10% for FNMAs. Overall, speeds for Gold 5.5% coupons and lower are similar to just slightly slower than Fannie cohorts. Speeds on certain Freddie 6% vintages are around 1% to 2% CPR, slower than corresponding FNMAs.

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