#mortgage-backed securities

#mortgage-backed securities

Part of the decline can be attributed to a continued gradual compression of the " mortgage spread" -the difference between the 10-year Treasury yield and the average 30-year fixed mortgage rate-as some investors slowly regain their appetite for mortgage-backed securities (MBS) and help fill the void left by the Federal Reserve when it stopped buying MBS in spring 2022. The other factor putting downward pressure on mortgage rates-and long-term yields-has been a recent stretch of softer-than-expected labor market data and financial market's growing expectation that the Fed will shift policy from restrictive to neutral.

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