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Willamette Falls Financial
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Minimal Impact From Fed
MBS Recap
Minimal Impact From Fed
MBS Recap Matthew Graham | 4:48 PM
Fed day has come and gone with minimal fanfare. Markets ultimately found reason to downgrade expectations for future rate hikes (likely due to Warsh's general "wait and see" comments during the press conference), but at the expense of a bit of weakness in the longer end of the yield curve. In other words, 2yr yields fell and 10yr yields rose. Neither were appreciably far from levels seen 2 days ago. Additionally, not all of the above should be attributed to the Fed. 10yr yields are actually ending the day lower compared to levels seen around noon (2 hours before the Fed announcement). Overnight weakness in the 10yr is easier to connect to lower funding costs for some of the neocloud companies that have recently been under the microscope. Afternoon gains corresponded with Oracle saying it anticipated lower funding needs.
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10/28/26 - General groundholding continues, but pressure has been mounting in the form of calmer nerves in the tech. Some small amount of risk associated with PCE and GDP data tomorrow.
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The bond rally in the 2nd half of October was driven by a surge in anxiety over certain parts of the tech sector. That anxiety and the corresponding rate rally have leveled off for now, but could head in EITHER direction depending on the tech sector narrative. Don't be complacent about the risk of a rebound.
| MBS |
| 30YR UMBS 6.0 |
99.64 |
+0.19 |
| 30YR UMBS 6.5 |
101.51 |
+0.16 |
| 30YR GNMA 6.0 |
99.61 |
-0.03 |
| 15YR UMBS-15 5.0 |
98.13 |
+0.16 |
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| US Treasuries |
| 10 YR |
5.008% |
+0.009% |
| 2 YR |
4.685% |
-0.052% |
| 30 YR |
5.335% |
+0.023% |
| 5 YR |
4.826% |
-0.012% |
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Broker/Owner
Willamette Falls Financial