Mortgage rates worsened today

as mortgage bonds fail to hold onto Friday’s afternoon gains, widening to Treasuries as money managers pick up selling. It’s been awhile since Treasuries were positive (albeit slightly) and mortgages were in negative territory. All eyes seem to be focused on the FOMC rate decision on Wednesday but it’s likely to be a non-event. Treasuries may suffer this week as another round of auctions will overwhelm the continued QE2 buybacks and if so, mortgages will likely follow. Reports of a comprehensive EU support package are helping to calm sovereign fears and stocks are back in rally mode with the Dow up over 80-points. No data is scheduled for today.