Benchmark 10s are just about back to their session high yield as Treasury prepares to release the results of their $13 billion long bond fundraiser. TSY price declines have led "rate sheet influential" MBS price back to session  lows.

The 10yr note is -0-10 at 101-15 yielding 2.456% (+3.2bps) and the FNCL 3.5 is -0-03 at 100-28 while the FNCL 4.0 is -0-03 at 103-01.

Loan pricing is 19 bps better on average at the five majors when compared to rate sheets yesterday morning. If the long bond auction is not well subscribed, rates may move higher.  In that event, lenders would be strongly considering reprices for the worse.