A 5-year, non-callable agency bond and a 1-year, callable bond were yielding about 1.90 percent, she said.
As you would expect, longer-term agency bonds have a bigger spread compared to government-issued notes, said Ralph Axel, director of U.S. rates for the Bank of America.
Ten- or 15-year agencies pay about 50 basis points more than Treasureys, he said.
Fannie Mae and Freddie Mac have a mandate to shrink in size and that has caused them to shrink the amount of bonds they issue, Axel said. From the end of 2013 to the end of June of this year, the two companies have $118 billion less in agency bond debt, he said.