Mortgage-Backed Securities Insights — Week of June 22, 2026

Hi, I’m Jerry Levy, Managing Director of Texas Capital’s Mortgage Securities Sales & Trading.

Former Federal Reserve chairman Alan Greenspan passed away. Greenspan was the Fed Chair for 18 years, from 1987 to 2006. It is worth noting that Chairman Greenspan was famous for speaking but saying little — the approach Chairman Warsh announced the Fed would return to last week. No longer will the Powell themes of Fed transparency, guidance and multiple Fed speakers to telling strategy be the norm. Think of it this way: The difference between the administration’s seemingly daily and, at times, hourly war headlines and attempt to move the markets, versus the minimalist, shortened guidance approach espoused by Chairman Warsh. W-A-R versus W-A-R-S-H is “sh,” and that summarizes how the FOMC would like to communicate with the markets. There are now five task forces that have been set up to codify these new protocols for setting and communicating Fed policy.

Price stability is the Fed’s main concern: controlling inflation. The markets reacted by flattening the curve with the two-year/10-year flattening to 29 basis points and twos/30s flattening to 73 basis points. This is the flattest since early 2025. A rate hike is now priced in for September, with a second hike by the end of the first quarter 2027. Nine Fed officials move their dots to show at least one hike in 2026. What is now clear is that this year, after a promising start, it is becoming the fourth consecutive year of the housing market mired in an affordability and supply crisis. 

On a positive note, the Bipartisan Housing Affordability Bill is making its way to President Trump’s desk this week entitled, quote, “21st Century Road to Housing Act,” which is intended to boost affordability by reducing regulations for those community banks that originate loans, for national- and state-chartered banks to invest in housing, to promote more manufactured housing by eliminating the permanent chasis requirement; it will ease environmental regulations for federal-funded housing developments and for local zoning codes; it will also expand grant programs while making it more difficult for institutional buyers to purchase additional single-family rentals. Expect more detail and expanded programs to be announced post the bill’s passage. 

Thank you for listening. Please go to Texas Capital’s LinkedIn page for all our updates. Until next time.