Agency Update

May 8, 2017



Agency yields continued to improve last week, increasing 4 to 8 bps across the curve.  Two-year Agency yields increased by 4 bps to 1.39%, 5-year Agency yields improved 8 bps to 1.99%, and yields on 10-year Agencies were higher by 8 bps to 2.73%.

Yield spreads for Agency bullets compared to Treasuries were fairly stable last week, but Agency callables tightened 2 to7 bps, depending on the structure and call tenor.

Activity last week was largely focused on the following:

For Agency callables, Freddie remains slightly cheaper in price to the other GSEs. Investors should be able to pick up 2 to 4 bps in Freddie paper, depending on the call structure and tenor.









Michael S. Erhardt, CPA

Senior Vice President

Investment Strategist

Vining Sparks, IBG

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