Bonds held Thursday's PCE-driven gains into the close — UMBS 5.0 finished at 98.59 (+0.08) and the 30-year rate settles at 6.53%.

The day's arc: a strong open on PCE data, a partial fade through the afternoon, and a close that held most of the gain. That's a reasonable outcome. Morning's +23 bps rally on UMBS 5.0 compressed to +8 by 5 PM — some profit-taking is normal after consecutive positive sessions, and the net result still pads Wednesday's big rebalancing move. Combined, the two-session run has pushed UMBS 5.0 up roughly 40 basis points from Wednesday morning's starting level. The PCE story hasn't changed: on-target inflation is a genuine bond-market positive, and that signal doesn't expire in an afternoon.

For borrowers, two consecutive days of improvement with a real macro driver underneath them is meaningful. The 30-year at 6.53% is at the low end of where it's been for months. Quarter-end is Monday, June 30 — the institutional rebalancing bid that helped push bonds Wednesday may unwind as the quarter closes, and Q3 opens with a fresh round of economic data that could cut either direction. That's not a reason to panic; it's a reason to act on the current window rather than wait for a better one that may not arrive before the calendar turns.

— David Burson, NetRate Mortgage