T. Rowe Price, Loomis Are Buying MBS That Have Grown Cheap

Money managers like T. Rowe Price Group Inc. and Loomis Sayles & Co. are increasing their purchases of mortgage-backed securities (MBS) which have become cheaper due to market volatility. Spreads on current coupon MBS widened to 1.25 percentage points by March 31, up from 0.94 percentage points in late January, making them an attractive bargain for these firms. While all bonds weakened in March, mortgage bonds underperformed Treasuries, prompting these investment opportunities.

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