Market Update 6/26/2008

Mortgage and Lending with CYPRESS MORTGAGE

Two-year Treasury notes rose, erasing declines, on speculation the Federal Reserve

won't raise borrowing costs this year amid signs the U.S. economic slowdown is

deepening. The yield on the two-year note, more sensitive to monetary policy than

longer-term securities, fell 5 basis points to 2.76 percent at 8:12 a.m. in New York,

according to BGCantor Market Data. It was the lowest since June 9. The price of the

2.875 percent security due in June 2010 rose 2/32, or 63 cents per $1,000 face

amount, to about 100 6/32. The 10-year note's yield was little changed at 4.10 percent,

after touching 4.13 percent. The Fed left its benchmark interest rate at 2 percent

yesterday and said ``upside risks'' to prices have picked up. The market is up to .375

better in discount this morning.

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