FOMC

Any intention that Ginnie Mae may have had to slow prepayment rates by changing the rules on RPLs seems to be thwarted by the grim economic reality facing the big banks.

FHFA, HUD and Ginnie Mae should let the rate of prepayments on MBS dictate bond prices and market rates.

The Federal Reserve pledged to maintain at least the current pace of asset purchases and projected interest rates will remain near zero through 2022, as Chairman Jerome Powell committed the central bank to using all its tools to help the economy recover from the coronavirus.

Mortgage rates fell to their lowest level since Freddie Mac started reporting this data in 1971, as the coronavirus shutdown continued to play havoc with the economy.

A number of proposals have been floated for debt payment holidays and other types of moratoria, but such approaches offer solutions that are worse than the problems.

Mortgage prices rose and spreads tightened Monday morning as investors responded favorably to the Federal Reserve's weekend announcement that it will resume net purchases of agency MBS for the first time since October 2014.

The Federal Open Market Committee lowered the fed funds rate target to between zero and ¼% in an emergency meeting on Sunday, but while analysts say the move was needed, they feel it will take more to offset the effects of COVID-19.

Increased refinancing volume led Fannie Mae to raise its 2020 estimate by $300 billion and 2021 projection by $280 billion.

Capacity constraints among mortgage lenders are leading to wider spreads between mortgages and the 10-year Treasury yield even after it remained below 1% for an extended period this week.

Mortgage rates hit their lowest point since Freddie Mac began tracking this data in 1971, as the 10-year Treasury yield fell below 1% after the Federal Open Market Committee's surprise short-term rate cut.

Investors' purchases of 10-year Treasurys after the Fed's 50 basis point short-term rate cut drove the yield below 1% for a period of time.

The Federal Reserve has voted unanimously to cut the interest rate 50 basis points to 1.10% effective March 4, in the first emergency rate cut since 2008.

The Federal Open Market Committee cut the fed funds rate target 50 basis points to a range between 1% and 1.25%, it announced Tuesday.

Policymakers may not wait until their mid-month meeting and could act with other central banks.

The Federal Reserve is monitoring the COVID-19 issue and its economic effects, according to a release from the central bank, attributed to Chairman Jerome Powell, released Friday.

Mortgage rates rose slightly with a stronger-than-expected jobs report starting the week and the Federal Open Market Committee decision to hold the line on short-term rates ending it, according to Freddie Mac.

For the mortgage industry, the question of whether the Fed can control its target range for interest rates is crucial for managing volatility.

The commercial mortgage-backed securities sector will weather the fourth quarter's slowing but steady growth in the U.S. economy, as better loan performance counters a continued decline in volume, Morningstar said.

The spike in overnight repurchase agreements may prompt the Federal Reserve to expand its balance sheet.

Wide short-term swings in interest rates — and loan prepayments — that we've all witnessed have serious secondary effects on consumers, lenders, investors and also policymakers.