Mortgage Backed Securities performed weak this week while the Equities market posted positive earnings.  The FNMA 30 YR 4.5% lost 1.28bp, translating into roughly .50% decline in Mortgage Rates. Two major Economic indicators also contributed to the MBS decline; Monday’s Core Producer Price Index and better than expected Friday 7 month high for Housing.

Next week’s Economic Calendar is light with reports, there are no Treasury auctions next week, which could help Bonds improve in the short term. In other words look for Mortgage Rates to improve!

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