WTMS Blog Today = What’s up in Mortgage Today (AM) – 02/05/2026
January job cuts surged to their highest level since 2009, with employers announcing over 108,000 layoffs according to Challenger, Gray & Christmas. The transportation and tech sectors took the biggest hits, with UPS and Amazon leading the charge. Despite these alarming headlines, the disconnect between consumer sentiment and actual economic indicators remains stark – unemployment sits at just 4.4% while consumer confidence mirrors Great Recession levels.
This morning’s jobless claims data came in at 231,000, higher than the 212,000 forecast, while continuing claims held steady at 1.844 million. The government shutdown has delayed key labor reports, pushing the crucial jobs report to next Wednesday. European central banks maintained their rates overnight as expected, with the Bank of England holding at 3.75% and the ECB at 2.00%.
Market Response and Fed Outlook
Bonds and mortgage-backed securities are gaining ground this morning while stocks retreat in what traders call the “software as a selloff” trade. The 10-year Treasury yield dropped to 4.238% after closing yesterday at 4.28%, providing some relief for mortgage pricing. Fed President Tom Barkin compared today’s AI productivity boom to the 1990s tech revolution, though he noted current inflation remains stubbornly above target.
Markets are increasingly focused on June for potential Fed rate cuts under Chairman Warsh’s leadership, as March cut odds continue to fade. The productivity gains from artificial intelligence could help combat inflation, similar to how the internet revolution aided the economy in the 1990s. However, unlike the 1990s when the US imported deflation from Japan’s economic collapse, today’s inflationary pressures present different challenges.
Locking vs Floating
With most of this week’s major economic data released, volatility should remain contained until next Wednesday’s rescheduled jobs report. Government shutdown postponements mean today includes both job openings and jobless claims data, which could create some market movement. MBS prices improved nearly an eighth of a point overnight with additional gains following morning employment data.
Today’s Events
– Continued Claims (Jan 24): 1,844K vs 1,850K forecast, 1,827K previous
– Jobless Claims (Jan 31): 231K vs 212K forecast, 209K previous
Bond Pricing
UMBS 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 99.85 | 0.13 |
| 5.5 | 101.37 | 0.1 |
| 6.0 | 102.41 | 0 |
GNMA 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 99.97 | 0.14 |
| 5.5 | 101.11 | -0.03 |
| 6.0 | 102.25 | -0.01 |
Treasuries
| Term | Yield | Price | Intra-Day Yield Change |
| 2 yr | 3.504 | 99.992 | -0.055 |
| 3 yr | 3.58 | 99.777 | -0.058 |
| 5 yr | 3.779 | 99.867 | -0.054 |
| 7 yr | 4.001 | 99.992 | -0.049 |
| 10 yr | 4.238 | 98.109 | -0.04 |
| 30 yr | 4.889 | 95.875 | -0.026 |
