WTMS Blog Today = What’s up in Mortgage Today (PM) – 01/27/2026
Markets delivered a tale of two sessions today, with morning gains gradually fading into afternoon weakness. The 10-year Treasury yield climbed 3.3 basis points to 4.246%, while UMBS 5.0 coupons managed to hold near flat at 100.05. Consumer confidence plummeted to 84.5 versus the 90.9 forecast, marking a significant miss that initially supported bond prices.
The labor differential between jobs plentiful versus jobs scarce hit a new cycle low at 3.1, down dramatically from 5.9 previously. This metric signals weakening employment conditions that should theoretically benefit mortgage rates. However, the market’s afternoon selloff suggests traders are focusing more on broader economic concerns than employment weakness.
MBS securities showed relative strength throughout the session, outperforming Treasuries along the shorter end of the yield curve. This divergence provides some cushion for originators, as mortgage rates don’t always move lockstep with Treasury yields. The afternoon recovery around 9 AM held steady through midday before gentle weakening resumed.
ADP Employment Change came in slightly below expectations at 7.75K versus 8.0K previous. While this miss typically supports bond prices, the impact was muted as markets await more significant economic data. The economic calendar remains light until the first week of February, limiting catalysts for meaningful rate improvement.
Locking vs Floating
Current conditions favor a defensive approach to rate risk management. Mortgage rates maintain some protection from broader bond market weakness due to GSE MBS purchases, but this insulation has clear limits. The lower boundary for mortgage rates was established in early January, and breaking below requires either substantial Treasury rallies or significant economic deterioration.
Market participants need either increased selling to create attractive entry points or legitimate weakness in major economic indicators. With no significant data releases on the horizon until early February, the path to meaningfully lower rates appears challenging. MBS prices offer helpful intraday risk management, while 10-year yield levels provide guidance on broader bond market momentum.
Today’s Events
– ADP Employment Change Weekly: 7.75K vs 8.0K prev
– Consumer Confidence: 84.5 vs 90.9 forecast, 94.2 prev
– Labor Differential (jobs plentiful vs jobs scarce): 3.1 vs 5.9 prev (new cycle low)
Bond Pricing
UMBS 30 yr
| Coupon | Price | Intra-Day Change |
GNMA 30 yr
| Coupon | Price | Intra-Day Change |
Treasuries
| Term | Yield | Price | Intra-Day Yield Change |
UMBS 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 100.05 | -0.01 |
| 5.5 | 101.4 | 0 |
| 6.0 | 102.39 | 0.04 |
GNMA 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 99.97 | 0 |
| 5.5 | 101.02 | -0.01 |
| 6.0 | 102.13 | 0.03 |
Treasuries
| Term | Yield | Price | Intra-Day Yield Change |
| 2 yr | 3.578 | 99.851 | -0.012 |
| 3 yr | 3.646 | 99.59 | -0.011 |
| 5 yr | 3.83 | 99.077 | 0.009 |
| 7 yr | 4.034 | 98.284 | 0.021 |
| 10 yr | 4.246 | 98.012 | 0.033 |
| 30 yr | 4.861 | 96.293 | 0.059 |
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