WTMS Blog Today = What’s up in Mortgage Today (PM) – 09/04/2025
Mortgage-backed securities showed mixed performance today as the 10-year Treasury yield declined to 4.16%, dropping 6 basis points from yesterday’s session. This movement in the bond market reflects ongoing economic uncertainty and investor appetite for safer assets. The decline in Treasury yields typically corresponds to improved pricing in the MBS market, though spreads remain elevated due to ongoing supply concerns. UMBS (Uniform Mortgage-Backed Securities) pricing has seen modest improvements today following the Treasury rally. Market participants are closely watching Federal Reserve policy signals and economic data releases that could influence future rate decisions.
Lock/float considerations favor locking positions given the volatile nature of current market conditions and potential for renewed selling pressure. GNMA securities are trading with similar patterns to conventional MBS, though government backing continues to provide some stability in pricing. The secondary market remains active despite origination volumes declining across the industry. Servicer hedging activities and convexity adjustments are contributing to ongoing price volatility in agency MBS. Mortgage rates have now moved lower for seven consecutive weeks, defying expectations of sustained upward pressure.
This trend has provided some relief to borrowers and lenders alike, though origination volumes remain constrained by affordability challenges. The mortgage industry continues to navigate reduced loan demand while managing operational capacity and staffing levels. Capital markets participants are monitoring employment data and inflation readings for additional direction on bond market trends.
Stratmor research indicates continued pressure on mortgage company profitability despite the recent rate environment improvements. The September housing survey shows mixed regional performance with some markets showing signs of stabilization while others continue to face headwinds.
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