MBS ALERT: TSYs Dragging Down MBS

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As the yield curve steepens (10yr and 30 yr Treasuries selling off more than short term bills and notes) the MBS stack has started to get sucked into the sell bias...

This justifies the premise that yesterdays bond market rally was due to a short covering in the TSY market (vs. long term  buy conviction). MBS are pacing the price behavior of Treasuries today. If Fed buyers are the only offsetting bid then MBS pricing may further deteriorate later in the day and reprices for the worse may occur

10:30am Marks

FN30_________________________            GN30__________________________

FN 4.5 -------->>>> -0-04  to  100-25             GN 4.5 -------->>>> -0-01 to  100-31

FN 5.0 -------->>>> -0-03  to  101-25             GN 5.0 -------->>>> -0-01 to  102-03

FN 5.5 -------->>>> -0-02  to  102-14             GN 5.5 -------->>>> -0-00 to  102-20

FN 6.0 -------->>>> -0-02  to  103-04             GN 6.0 -------->>>> -0-02  to  102-31