CHM Blog

The 10 year at 4 pm ET 3.52% -6 bps, at 5 pm 3.49%; the 2 year at 4 pm 4.14% -3 bp, at 5 pm 4.09% -8 bp. Safety into treasuries as Republic Bank reported more losses than were thought and its outlook will take years to overcome. The bank had to borrow heavily at high rates from the Federal Reserve, the Federal Home Loan Bank and JPMorgan Chase & Co., in addition to the $30 Billion that JPMorgan and 10 of the other largest banks deposited at the bank to rescue it. Total borrowings peaked at $138.1 Billion on March 15, declining to $104 Billion as of April 21, the bank said in its quarterly earnings statement on Monday. The soft report drove a last minute run into treasuries between 4:30 pm and 5 pm. Analysts saying the next week will be critical for the bank’s survival.

This morning the 10 year note began at 3.43% -6 more bps from the late move yesterday, the 2 year note yesterday down 8 bps, at 9 am down another 5 bps. MBS prices at 9 am this morning +8 bps on the 6.0 coupon, +20 bps on the 5.5 coupon.

Feb Case/Shiller home price index expected -0.3%, reported -0.25%; year/year expected 0.0% increased 0.4%. Feb FHFA price index expected -0.1% increased 0.5%, year/year +4.0% from +5.3% in January.

At 9:30 am the DJIA opened -41, NASDAQ -69, S&P -17. 10 year 3.44% -5 bps and 10 bps lower than 9:30 am yesterday. FNMA 6.0 coupon at 9:30 am +14 bps and +16 bp from 9:30 am yesterday; 5.5 coupon +19 bp and +16 bps from 9:30 am yesterday.

At 10 am March new home sales, expected at 634K from 640K, sales were up to 685K the strongest since March 2022. Details this afternoon.

Also, at 10 am April consumer confidence index, forecasts 104.0 from 104.2, reported at 101.3 the lowest since July 2022. The Conference Board Consumer Confidence Index® fell in April to 101.3 (1985=100), down from 104.0 in March. The Present Situation Index (based on consumers’ assessment of current business and labor market conditions) increased to 151.1 (1985=100) from 148.9 last month. The Expectations Index (based on consumers’ short-term outlook for income, business, and labor market conditions) fell to 68.1 (1985=100) from 74.0. The Expectations Index has now remained below 80 (the level associated with a recession within the next year) every month since February 2022, with the exception of a brief uptick in December 2022. The survey was fielded from April 3 (about three weeks after the bank failures in the United States) to April 19.

This morning MBSs are improving in a catch-up trade. By 10 am FNMA 6.0 coupon +5 bps from 9:30, 5.5 coupon +12 bps from 9:30. No change in the outlook that the Fed will increase rates a week from tomorrow, and that the Fed will likely stop increasing after that, or that the economic outlook by most big firms expecting a recession later this year. On Thursday, the first look at Q1 GDP is thought to be +2.0% from +2.6% in Q4 2022. The 10 year note still within its trading range at 3.44%, (3.40%-3.60%)

PRICES @ 10:05 AM

10 year note: 3.42% -8 bp

5 year note: 3.49% -9 bp

2 year note: 4.03% -6 bp

30 year bond: 3.66% -5 bp

Libor Rates: 1 month 5.016%; 3 month 5.268%; 6 month 5.434%; 1 year 5.428% (4/24/23)

30 year FNMA 6.0: @9:30 am 101.89 +14 bp (+16 bp from 9:30 am yesterday)

30 year FNMA 5.5: @9:30 am 100.80 +19 bp (+16 bp from 9:30 am yesterday)

30 year GNMA 5.5: @9:30 am 100.64 +8 bp (+5 bp from 9:30 am yesterday)

Dollar/Yuan: $6.9264 +$0.0300

Dollar/Yen: 134.00 -0.28 yen

Dollar/Euro: $1.1000 -$0.0048

Dollar Index: 101.62 +0.27

Gold: $1998.80 -$1.00

Bitcoin: 27,395 -39

Crude Oil: $77.83 -$0.93

DJIA: 33,856 -18

NASDAQ: 11,960 -77

S&P 500: 4116 -21

Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.