Stocks are lower this morning on no real news. Bonds and MBS are flat.
Donald Trump has nominated Kevin Warsh to succeed Jerome Powell as Fed Chairman. “I have known Kevin for a long period of time, and have no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best,” Trump said in a Truth Social post announcing the selection.
Warsh has previous experience at the Fed and is considered to be a safe choice for the markets. While he will probably support lowering rates, he is considered to be independent enough that he can resist Trump’s worst instincts.
Inflation at the wholesale level rose 0.5% month-over-month in December and rose 3.0% for 2025. This is an acceleration from the benign 0.1% and 0.2% increases in October and November. The increase was driven by final demand services, which was attributable to an increase in retailer and wholesaler margins.
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New Feature: Expanded Market Data with SOFR Swaps
You’ll notice our daily market data now includes SOFR swap rates, provided by Eris Innovations. These rates are derived from Eris SOFR Swap futures (native CME Group contracts), offering a transparent view of long-term rates.
Why this matters for your workflow: Since SOFR replaced LIBOR, it has become the universal benchmark for financing. Using SOFR swaps—rather than Treasuries—for modeling and hedging offers several advantages:
- Capital Efficiency: Swap futures require significantly less balance sheet than cash instruments.
- Precision Hedging: Liquid across the curve (out to 30 years), they allow you to isolate benchmark interest rate risk from credit spread exposure.
- Strategic Utility: Already widely used for hedging MSR portfolios, but they are also becoming the instrument of choice for hedging ARMs, non-QM, RTL, and key rate duration for Agency mortgage portfolios.
By benchmarking against SOFR, and easily trading this with Eris SOFR Swap futures, investors can more effectively monitor the “pure” credit spread of their mortgage assets, which can then be separately managed using Mortgage TBAs. Contact john.douglas@erisfutures.com to learn how Eris SOFR can help you improve your execution.
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The median rent in January fell 1.4% to $1,353, according to Apartment List. The vacancy rate hit 7.3%, which is a record high. “Early last year, it appeared that annual rent growth was on track to flip positive for the first time since mid-2023; however, that rebound stalled out and reversed course during a slow summer moving season that has now dragged into the winter,” wrote Chris Salviati, chief economist at Apartment List.
Multifamily units under construction have fallen back to prepandemic levels however there is still a decent amount of supply that has yet to hit the market.
