Day Two of the Rout: MBS Closed Down -14/32 and Rates Hit a 5-Week High
Tanker attacks in the Gulf. Brent crude near $100. The Dow down 600 points. MBS closed at the lows again — down -14/32. Freddie Mac's weekly survey just confirmed 6.11%. Here's what happened and what you need to do right now.
Today was the second consecutive brutal day for the bond market — and in some ways it was worse than yesterday. MBS opened slightly in the green, giving a brief moment of hope, then completely rolled over. By 3:18 PM, an Unfavorable Alert was issued with MBS down -14/32 — nearly a full half-point in price from the morning open. The Mortgage News Daily daily rate index closed at 6.29%, the highest level in more than a month. Freddie Mac's weekly survey, released this morning, confirmed a 30-year fixed rate of 6.11% — up 11 basis points from last week and back to where rates were five weeks ago. (Sources: Mortgage News Daily, Freddie Mac PMMS, r/MortgageRates MBS Monitor, March 12, 2026)
The drivers are the same as yesterday but intensifying. Tanker attacks in the Gulf of Oman were reported overnight, and Brent crude is teetering right below $100 a barrel. Bloomberg reported this morning that global bonds have now surrendered all of their 2026 gains as elevated oil prices stoke fears that inflation will reignite. The 10-year Treasury yield hit 4.25% today — up from 3.94% just two weeks ago, a move of 31 basis points in 14 days. That kind of yield spike translates directly into higher mortgage rates. The bond market is no longer treating Treasuries as a safe haven: the Dow was down 600+ points today, and bonds still sold off alongside stocks. (Sources: Bloomberg, The Mortgage Reports, StoneX Morning Commentary, March 12, 2026)
The 30-year Treasury auction at 1:00 PM ET was the day's wildcard. Despite fears of a repeat of yesterday's failed 10-year auction, today's 30-year auction actually saw stronger-than-average demand. That gave MBS a brief bounce to -4/32 around 1:08 PM — but it didn't hold. The broader sell-off resumed and accelerated into the close, with MBS finishing at -14/32 (price approximately 98-18). Lenders who hadn't already repriced worse in the afternoon were forced to do so before end of day. The pattern of early-morning losses followed by afternoon recoveries has officially broken. (Source: ShanetheMortgageMan, r/MortgageRates)
The bottom line: there is no clear end in sight to the military conflict, and every day it continues adds to oil inflation expectations and government deficit fears. The strategy is simple — if you are closing within 30 days and you are floating, stop. Lock today. The risk of waiting is not worth it. If you're closing in 30–45 days, locking now caps your risk. If you're more than 45 days out, you have some runway to watch the geopolitical situation evolve, but the ceiling for rates is moving higher. Reach out and I'll walk you through your exact options — locking now versus floating, side-by-side — so you can make the call with full information.
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