08/21/2026
Mortgage rates ended the week higher.
Treasury grabbed headlines this week when Secretary Scott Bessent announced Treasury would double the size of buybacks ($4 billion from $2 billion) in the 10-20 year and 20-30 year maturity buckets, buying back off-the-run 20-year and 30-year treasuries. The move temporarily worked as intended – driving long bond yields lower. But the rally reversed (shorts covered and the selling resumed) as investors questioned whether buybacks could overcome the underlying issues – inflation, growing deficit spending. The national debt crossed $40 trillion this week. 200 years for the first trillion, 95 days for the latest trillion.
Oil prices rose ~5.75% this week to ~$87/bbl. The SPR showed its 21st consecutive weekly draw, falling by 5.268mm bbls. Total crude stocks ex SPR rose by 4.405mm bbls, the third consecutive weekly build.
Housing starts fell 12.44% MoM to an annualized 1.24mm.
Fed Funds Futures give a 60% chance of no change in September and a 60% chance of a 25 bps rate hike in October.
Next Week: Core PCE on Wednesday, Non Farm Payroll Annual Revision (preliminary release, final release is in February). The last two Non Farm Payroll annual revisions saw job gains reduced by a seasonally adjusted -589k and -898k respectively.
