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Yes to the lending solution that meets every client’s unique needs and wants.
That’s why we dedicate our every resource to serve as your personal guide through the lending process, solving problems, building confidence. Aslan has access to every lending option leading to the purchase or refinance of a residential home loan.
This is more than work for us. It is our unique joy in this life to share our collective skill, creativity, and care to bring you and your family right to where you belong.
Dots and Powell Were Much Less Friendly Than Markets Expected
Wed, Dec 18 2024, 5:07 PM
MBS Recap
Dots and Powell Were Much Less Friendly Than Markets Expected
MBS Recap Matthew Graham | 5:01 PM
Dots and Powell Were Much Less Friendly Than Markets Expected
We knew the bond market was expecting a hawkish shift in the dot plot (the chart that shows each Fed member's expectation for the Fed Funds Rate in the coming months/years), and while there is now easy way to know exactly how big the expected shift was, it was clearly not as big as the shift we actually saw! The median dot moved from the low 3% range for the end of 2025 to just under 4% (here's the before and after). On top of that, Powell's press conference offered no reprieve as he confirmed the Fed was entering a new policy-making phase marked by the possibility of pausing rate cuts and the reality that current rates are closer to neutral than previously believed. Bonds tanked immediately upon the release of the dots and then tanked some more as Powell began answering questions 30 minutes later.
weaker overnight with Europe, but recovering in early domestic trading. MBS up 2 ticks (.06) and 10yr down 1bp at 4.391
12:47 PM
10yr down 1.5bps at 4.386. MBS up 1 tick (.03).
02:13 PM
Sharply weaker after Fed announcement (and dot plot). MBS down a quarter point and 10yr up 4.7bps at 4.447
02:57 PM
More losses during Powell Press Conference. MBS down almost half a point and 10yr up 8.5bps at 4.486
03:38 PM
How low can we go? MBS down more than 5/8ths. 10yr up 10.3bps at 4.505
Lock / Float Considerations
All bets are off until further notice following the Fed day rout. That said, it has been and continues to be the case that any meaningful improvement in rates will require downbeat economic data and softer inflation. At this point in the year, we're waiting until early January for the next major shoes to drop (NFP and CPI, specifically).
Yes to the loan that unlocks the joy of home ownership.
Yes to the lending solution that meets every client’s unique needs and wants.
That’s why we dedicate our every resource to serve as your personal guide through the lending process, solving problems, building confidence. Aslan has access to every lending option leading to the purchase or refinance of a residential home loan.
This is more than work for us. It is our unique joy in this life to share our collective skill, creativity, and care to bring you and your family right to where you belong.
