From 101-31 highs, Fannie 3.5s have fallen 7 ticks into the afternoon hours, currently at 101-24. Reprice risk is probably not a factor here considering we’re still up 9 ticks on the day, almost no one repriced positively earlier, and rate sheets began the day in conservative shape.
That assessment is only valid for right now, though, and one or two negative reprices couldn’t be altogether ruled out.
More importantly, the trend since 11am has been back toward higher rates and lower prices. If 10’s break above one or both of the overhead technical levels of 2.623 and 2.628, that would make for an increasingly risky environment for MBS and reprices. We’re right on the edge right now.