January 22nd Mortgage Market Wrap=up

MBS prices are up +4/32 (FNMA 30-yr 4.o at (99.81), back to the initial price level. Unfavorable repricing took place. MBS prices reached a low of -4/32 before moving higher again. Today's economic data came in weaker than expected, but it produced little reaction in MBS markets. December Housing Starts and Building Permits fell to record low levels, which will help reduce the inventory of unsold homes on the market. The Dow fell 100 points. No economic data will be released tomorrow.

The Fed purchased $19.0 billion in agency MBS during the weekly period ending January 21. Freddie Mac reported that average mortgage rates rose in the week through January 22, with 30-yrs hitting 5.12% from 4.96% the prior week.