- 10-YR: The yield on the 10-year Treasury fell 31 basis points from Monday’s open at 3.70% to Friday’s close of 3.39%.
- MBS: The 30YR UMBS 5.0 jumped 65 cents from Monday’s open at $99.08 to Friday’s close at $99.73.
After last week’s jobs report very few were expecting a drop in rates. However, the uncertainty of the US and global banking system put some strong downward pressure on rates. The big question now is what will the Fed do at next week’s meeting. The European Central Bank surprised many with a 50 bip hike earlier this week. They made it clear that inflation is a bigger concern than potential problems in the banking system. Now the ball is in Jerome Powell’s court. Economists believe the Fed will raise rates by a quarter point. However, if another bank ends up in crisis this week I think all bets are off.