Mortgage bonds slump near post-crisis record

The rout comes as global markets remain on edge after a sell-off in government bonds drove long-term borrowing costs in the United States and Europe to the highest levels in more than a decade. — Bloomberg

NEW YORK: The sell-off in government bonds and the US Federal Reserve’s tightening message is claiming another victim: the US$8 trillion mortgage bond market.

Mortgage-backed securities (MBS), which repackage home loans backed by the US government, cheapened to some of the widest levels in history in recent weeks, according to a key measure.