Market Wrap-up
Our benchmark FNMA MBS 5.500 October Coupon is down -4 BPS at 2:15 PM ET.
The Talking Fed: Fed Gov Waller said during an interview with CNBC’s Steve Liesman that “That is what put me back a bit to say, wow, inflation is softening much faster than I thought it was going to, and that is what put me over the edge to say, look, I think 50 [basis points] is the right thing to do.”
Central Bank Palooza: Both the People’s Bank of China (3.35%) and the Bank of Japan (0.15%) kept their main interest rates unchanged.
Interest rates held well today but there was some additional selling in MBSs after holding steady until about 2:30 pm ET. There wasn’t any direct news today.
Federal Reserve Gov. Michelle Bowman said today why she descended Wednesday against the 50 bp cut. She is the first dissenter at an FOMC meeting in two years. In a statement on Friday explaining her decision, Bowman said that she agreed that it was time to start easing monetary policy but preferred starting smaller. “I see the risk that the committee’s larger policy action could be interpreted as a premature declaration of victory on our price stability mandate.” “We have not yet achieved our inflation goal,” Bowman said. “I believe that moving at a measured pace toward a more neutral policy stance will ensure further progress…This approach would also avoid unnecessarily stoking demand.” The Fed went 50, recalibrating as Powell said numerous times Wednesday to more emphasis on the sliding employment sector rather than making inflation the #1 priority that has spooked rate markets temporarily. Powell believes inflation is on a declining path. The core personal consumption expenditures price index—the Fed’s preferred measure—was up 2.6% from a year earlier in July, the latest data available. Next Friday August PCE data will be reported.
Federal Reserve Governor Christopher Waller said today he supported a half percentage point rate cut at this week’s meeting because inflation is falling even faster than he had expected. Even the Fed officials can’t agree on present inflation, or they spin it to what they perceive. He went for the CPI core as his reasoning, instead of the PCE as Bowman recited, and referenced the last four months while year/year core CPI stands at 2.5% citing recent data on consumer and producer prices, Waller told CNBC that the data is showing core inflation, excluding food and energy, in the Fed’s preferred measure is running below 1.8% over the past four months. The Fed targets annual inflation at 2%.
Next Week’s Calendar: Monday S&P global manufacturing and services indexes. Tuesday Case/Shiller July home price index, September consumer confidence index. Wednesday weekly MBA mortgage apps, August new home sales. Thursday weekly jobless claims, August durable goods orders, final Q2 GDP, August pending home sales. Friday August PCE, August personal income and spending, final U. of Michigan consumer sentiment data.
This Week: The 10 year note yield increased 7 bps this week, the 2 year note was unchanged. The DJIA increased 669, NASDAQ +300, S&P +77. Bitcoin rallied 3,209, the dollar index slipped 0.39. Gold continued higher, +$38.00 this week; crude oil increased $2.69.
What we had this week is ‘buy the rumor, sell the fact’. Even with most looking for 50 bps by the end of the year, there are a lot of inflation reports before the Next FOMC meeting two days after the elections. The September employment report Oct 44, PCE inflation data next Friday, CPI on Oct 10th, Oct employment report on Nov 1st plus others.
CENY @ 4:00 PM
10 year note: 3.73% +2 bp
5 year note: 3.49% unch
2 year note: 3.59% unch
30 year bond: 4.07% +2 bp
30 year FNMA 5.5: 101.43 -8 bp (-4 bp from 9:30)
30 year FNMA 6.0: 102.38 -6 bp (-1 bp from 9:30)
30 year GNMA 5.5: 101.20 -1 bp (-3 bp from 9:30)
Dollar/Yen: 143.80 +1.17 yen
Dollar/Euro: $1.1164 +$0.0004
Dollar Index: 100.72 +0.10
Gold: $2,647.70 +$33.10
Bitcoin: 63,000 -270
Crude Oil: $71.77 -$0.18
DJIA: 42,062.83 +37.64
NASDAQ: 17,984.32 -65.66
S&P 500: 5702.62 -11.02
SOFR Data 09/20: 30-DAY AVERAGE(%): 5.32901, 90-DAY AVERAGE(%): 5.36547, 180-DAY AVERAGE(%): 5.39533, INDEX: 1.15930684
Poland
| Name | Value | Net Change | % Change | 1 Month | 1 Year | Time (EDT) |
| WIG20:IND
|
2,279.98 | -46.82 | -2.01% | -4.34% | +15.41% | 11:15 AM |
| WIG:IND
|
81,759.69 | -1,444.09 | -1.74% | -2.34% | +21.50% | 11:15 AM |
| WIG30:IND
|
2,876.02 | -57.45 | -1.96% | -4.11% | +17.39% | 11:15 AM |
WALUTY
| Currency | Value | Change | Net Change | Time (EDT) |
| EUR-USD
|
1.1162 | 0.0000 | 0.00% | 4:59 PM |
| USD-JPY
|
143.8500 | 1.2200 | +0.86% | 4:59 PM |
| GBP-USD
|
1.3321 | 0.0037 | +0.28% | 4:59 PM |
| AUD-USD
|
0.6807 | -0.0007 | -0.10% | 4:59 PM |
| USD-CAD
|
1.3569 | 0.0010 | +0.07% | 4:59 PM |
| USD-CHF
|
0.8500 | 0.0022 | +0.26% | 4:59 PM |
| USD-MXN
|
19.4148 | 0.0952 | +0.49% | 4:59 PM |
| USD-CZK
|
22.4483 | -0.0359 | -0.16% | 4:59 PM |
| USD-SKK
|
26.9889 | -0.0013 | 0.00% | 4:59 PM |
| USD-PLN
|
3.8251 | -0.0038 | -0.10% | 4:59 PM |
| USD-HUF
|
352.1300 | -1.0300 | -0.29% | 4:59 PM |
| USD-RUB
|
92.3683 | 0.0054 | +0.01% | 12:02 PM |
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| ELITE 11-15 YEAR | ELITE 8-10 YEAR | ||||||
| RATE | 15 DAY | 30 DAY | 45 DAY | RATE | 15 DAY | 30 DAY | 45 DAY |
| 6.250 | -2.820 | -2.730 | -2.600 | 6.000 | -3.282 | -3.192 | -3.062 |
| 6.125 | -3.094 | -3.004 | -2.874 | 5.875 | -3.034 | -2.944 | -2.814 |
| 6.000 | -2.877 | -2.787 | -2.657 | 5.750 | -2.650 | -2.560 | -2.430 |
| 5.875 | -2.616 | -2.526 | -2.396 | 5.625 | -2.838 | -2.748 | -2.618 |
| 5.750 | -2.231 | -2.141 | -2.011 | 5.500 | -2.563 | -2.473 | -2.343 |
| 5.625 | -2.353 | -2.263 | -2.133 | 5.375 | -2.266 | -2.176 | -2.046 |
| 5.500 | -2.065 | -1.975 | -1.845 | 5.250 | -1.861 | -1.771 | -1.641 |
| 5.375 | -1.754 | -1.664 | -1.534 | 5.125 | -2.152 | -2.062 | -1.932 |
| 5.250 | -1.349 | -1.259 | -1.129 | 5.000 | -1.814 | -1.724 | -1.594 |
| 5.125 | -1.578 | -1.488 | -1.358 | 4.875 | -1.480 | -1.390 | -1.260 |
| 5.000 | -1.223 | -1.133 | -1.003 | 4.750 | -1.033 | -0.943 | -0.813 |
| 4.875 | -0.875 | -0.785 | -0.655 | 4.625 | -0.998 | -0.908 | -0.778 |
| 4.750 | -0.427 | -0.337 | -0.207 | 4.500 | -0.584 | -0.494 | -0.364 |
| 4.625 | -0.365 | -0.275 | -0.145 | 4.375 | -0.192 | -0.102 | 0.028 |
| 4.500 | 0.067 | 0.157 | 0.287 | 4.250 | 0.287 | 0.377 | 0.507 |
| 4.375 | 0.476 | 0.566 | 0.696 | 4.125 | 0.761 | 0.851 | 0.981 |
| 4.250 | 0.955 | 1.045 | 1.175 | 4.000 | 1.214 | 1.304 | 1.434 |
| 4.125 | 1.430 | 1.520 | 1.650 | 3.875 | 1.697 | 1.787 | 1.917 |
| 4.000 | 1.906 | 1.996 | 2.126 | 3.750 | 2.183 | 2.273 | 2.403 |
Home price changes for Chicago-Naperville-Evanston, IL
| Metro Area | Last quarter | 2 qtrs ago | 1 year ago | 3 yrs ago | 5 yrs ago | Custom Period | See Mortgage Rates |
| Chicago-Naperville-Evanston, IL | 2.99% | 4.95% | 7.53% | 28.83% | 42.54% | Tracking Tool | Shop refinance rates for Chicago-Naperville-Evanston, IL |