monthly macro monitor
key trends for the agency mbs investor
december 2025
- Effects of the federal government shutdown continued to impact data availability for the December economic releases, but economic reporting is expected to normalize by late January with the combined release of the October and November PCE data on January 22nd. Although reporting will return to its traditional schedule, the Bureau of Labor Statistics will not be able to release October unemployment or CPI figures because the primary data was never collected during the shutdown. As such, these missing data points have been replaced with ‘imputed’ values that may mask data trends in future releases.
- In light of this dynamic, Chair Powell cautioned at the Fed’s December press conference that near-term inflation and labor reports may be “more volatile” and “distorted” and that the Fed will likely “have to look at [the data] carefully and with a somewhat skeptical eye by the time of the January meeting.”
- The macro environment for Agency MBS remained favorable in December, as interest rate volatility declined, the yield curve steepened, and Agency MBS spreads to benchmark rates tightened over the course of the month.
Key Rate and Spread trends
Important Disclosures
Federal funds rate data last updated December 31, 2025. Source: Federal Reserve.
Economic data last updated December 31, 2025. Core CPI and Core PCE exclude food and energy. Source: Bureau of Labor Statistics and Bureau of Economic Analysis.
U.S. Treasury yield curve reflects month-end Treasury yields for each tenor and month shown. Source: Bloomberg.
Agency MBS spread to U.S. Treasuries and Agency MBS spread to swaps reflect the 30-year current coupon Agency MBS yield spread to a 50/50 average of 5- and 10-year U.S. Treasury yields and a 50/50 average of 5- and 10-year SOFR OIS swaps, respectively. MOVE Index reflects the ICE BofA Move Index. Each chart is shown over the trailing 12 months ended December 31, 2025, and each monthly change (rounded to the nearest whole number) reflects the difference between December 2025 month-end data and November 2025 month-end data. Source: Bloomberg.
Data and commentary, including thoughts, opinions, and outlook of AGNC Investment Corp. (“AGNC”) management, are provided for information purposes only and should not be construed as investment advice.
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