CHM Blog

Prior to 8:30 am ET this morning the bellwether 10 year traded at 3.82% +3 bp from yesterday. Weekly jobless claims released at 8:30 am was expected at 235K +3K from the week before, claims increased to 261K +28K. The increase is what the Fed wants to see, more workers filing, a measure of weaker labor markets but looking to the May employment report last week, job growth far exceeded what had been expected (Non-farm jobs expected 190K increased 339K and April jobs originally reported at 253K revised to 294K. Private jobs thought to be at 165K increased 283K and April revised from 230K to 253K). The claims last week likely an anomaly or the Labor Debt’s jobs numbers were inaccurate. Likely it is last week’s claims. The reaction to the claims pushed the 10 year note back to 3.79% unchanged from yesterday and MBS prices at 9 am -14 bps. Countering the claims jump, continuing jobless claims for the week ending May 27 decreased 37,000 to 1.757 million. The claims reported is the highest since November 2021.

The Fed still expected to pause next week at the FOMC meeting, traders and investors looking now to the July FOMC meeting for another 25 bp increase. This week ECB made it clear it would raise rates at its meeting next week. This week Australia and Canada did increase their base rates. ECB targeting 2.0% inflation, same as the Fed; inflation in the zone 8.4% in 2022, expected at 5.8% this year and 3.2% in 2024. Inflation in the global economies is edging lower, in the US 4.6%, but not close to 2.0%.

At 9:30 am the DJIA opened -16, NASDAQ +16, S&P +1. 10 year 3.78% -1 bp. FNMA 6.0 30 year coupon at 9:30 am +3 bps but -12 bps from 9:30 am yesterday.

The 10 year has held at 3.80% a key chart support level. Don’t look for any big moves today. 10 year note trading in a 10 bp ranges, 3.70% to 3.80% likely will keep in that area. This morning MBS prices at 9:30 am +3 bps, at 10 am +23 bps as the 10 year note has slipped from 3.82% early today to 3.76% at 10 am.

PRICES @ 10:00 AM

10 year note: 3.75% -4 bp

5 year note: 3.87% -7 bp

2 year note: 4.50% -6 bp

30 year bond: 3.93% -2 bp

Libor Rates: 1 month 5.182%; 3 month 5.510%; 6 month 5.644%; 1 year 5.746% (6/7/23)

30 year FNMA 6.0: @9:30 101.02 +3 bp (-12 bp from 9:30 am yesterday) (at 10 am +23 bps on the day)

30 year FNMA 5.5: @9:30 99.77 +8 bp (-14 bp from 9:30 am yesterday) at 10 am +23 bps on the day)

30 year GNMA 5.5: @9:30 99.83 +6 bp (-6 bp from 9:30 am yesterday) (at 10 am +20 bps on the day)

Dollar/Yuan: $7.1170 -$0.0128

Dollar/Yen: 139.11 -1.05 yen

Dollar/Euro: $1.0758 +$0.0058

Dollar Index: 103.54 -0.56

Gold: $1980.40 +$22.00 (weak dollar)

Bitcoin: 26,384 +29

Crude Oil: $72.21 -$0.32

DJIA: 33,690 +25

NASDAQ: 13,129 +24

S&P 500: 4267 unch

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.