Absolutely No Surprises From Powell

What a letdown, but also what an unsurprising speech from Fed Chair Powell.  He did the market a solid and threw in a mention of “R Star” and the inflation target, but not in a way that offered any new insight beyond anything shared at the last press conference. Markets had some positioning to work through in the wake of the speech, but the process was done by lunch with both MBS and Treasuries perfectly unchanged by the 1pm hour.

Econ Data / Events

Consumer Sentiment

69.5 vs 71.2 f’cast, 71.6 prev

1yr inflation exp.

3.5 vs 3.3 f’cast

5yr inflation exp.

3.0 vs 2.9 f’cast

Market Movement Recap

09:28 AM Losing some ground.  10yr up 1.4bps at 4.255.  MBS down 3 ticks (.09).

10:49 AM Some weakness after Powell, but stabilizing now.  MBS down 5 ticks (.16) and 10yr up .6 bps at 4.247.

02:57 PM Additional gains, but modest.  MBS up 1 tick (.03) and 10yr down 0.2bps at 4.239.

Published On: August 25, 2023 / Categories: Mortgage News /