MBS Returns Extend Negative Streak During Worst Year On Record (MBS Prices Dropping With Fed Tightening And M2 Money Growth Decline)

by confoundedinterest17

The housing and mortgage markets are suffering with impending recession and Fed monetary tightening.

MBS returns extended their negative run during their worst year on record as 10-year Treasury yields topped 4% and the trend in MBS spreads widened.

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The MBS sector has had only two positive months in both total and excess returns this year — May and July.

Take a look at the 4.5% coupon agency MBS price and risk (duration) with Fed tightening (orange line) and crashing M2 Money growth (green line).

Time for something new in the MBS market?


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