Agency spreads widen slightly on 'typical' slow summer Friday; Freddie Mac announcement ahead

By Lisa Kerner

Charlotte, N.C., July 23 - Agency spreads opened wider on the curve but ended Friday unchanged to slightly wider in all sectors, according to a trader, who called it a typical Friday "only slower."

He saw little activity on the day and was not surprised given the time of year.

Stocks were "pretty quiet" while Treasuries were "a little more active," he said.

Another source saw agency spreads as being "a touch wider across the curve" with some profit taking.

He described callables as being "fairly muted."

"We had a nice run the last two weeks," he said.

The source also commented on the summer lull, saying "if you haven't done anything by 11 o'clock, your day is pretty much done."

Another trader said agency spreads moved out about 1 to 2 basis points. He couldn't attribute the movement to anything in particular and also remarked on the slowness of the day.

The trader noted that Freddie Mac is expected to make an announcement on Thursday. Freddie Mac could just be reopening an issue, in which case the size would be about $1 billion, the trader said.

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