June 20t Mortgage Market Wrap-up 2

Mortgage backed securities (MBS) closed down 28 basis points today at 1.04.75 having fallen through support offered by the 25 day moving average prior to bouncing back above it at the close.  The bond now finds itself perilously perched barely above this important support level.  Althogh the Fed made postive comments about inflation, the bond's worst enemy, and negative comments about the economy, which are bond friendly, the lack of a commitment to QE3 caused the bond to falter today.  The 30 year fixed rate remained at 3.625% today.