Surprising no one, the Federal Reserve’s Federal Open Market Committee Wednesday decided not to raise the target rate on federal funds above the current 2.25 percent. The vote, as usual, was unanimous.
Depending on what type of Fannie Mae/Freddie Mac reform occurs in the next few years, there’s a growing concern in the market that foreign investors — and others — may shy away from their MBS unless there’s an explicit guarantee on the securities.
Nonbank mortgage operations continued their assault on the agency MBS market in 2018, increasing their penetration in both new issuance and servicing. [Includes two data charts.]
An estimated $9.6 billion of Ginnie Mae securities backed by FHA-insured reverse mortgages were issued in 2018, down from $10.5 billion a year ago, according to New View Advisors.
The Community Home Lenders Association has expressed concerns that Ginnie Mae is on a mission to reduce the number of MBS issuers and tighten credit standards — moves that would affect its core members and hurt its housing mission.
Commercial real estate collateralized loan obligations are a valuable financing tool, albeit with some risks, industry officials said at a conference sponsored by the CRE Finance Council in Miami last week.
The average daily trading volume in agency MBS fell to $212.9 billion in December, one of the lowest readings of the year, according to figures compiled by the Securities Industry and Financial Markets Association.
Fannie Mae and Freddie Mac are coming off strong years for their multifamily business and most observers say that success is likely to continue well into 2019.
Some Democrats are concerned that FHFA nominee Mark Calabria isn’t the best person to chart the GSEs’ future course. A full Senate confirmation of Calabria could take several months, though.
The Federal Reserve will continue to unwind its massive $4 trillion portfolio — $2.2 trillion in Treasuries, $1.64 trillion in agency MBS, and agency debt. This, Federal Reserve Chair Jerome Powell told financier David Rubenstein in a public forum at the Economics Club of Washington last week. Left unsaid is what this will mean for the agency MBS market.