Guest post by TheDealer
There is no direct evidence for this, but folks on trading floors are saying the Fed may be trying to smack down 30-year fixed mortgage rate. The average rate is still near historical lows.
|30 year fixed mortgage rate (source: BankRate.com)|
But it seems every time the rate pops up from the lows, a series of Operation Twist trades takes place. Here is what happened to the treasury curve Friday - some visible flattening action.
|Friday's change in treasury yields by maturity|
Call me crazy but I don't think this is a coincidence.