Mortgage (ARM) Indexes: Constant Maturity Treasury Index (CMT)

Constant Maturity Treasuries is a set of "theoretical" securities based on the most recently auctioned "real" securities: 1-, 3-, 6-month bills, 2-, 3-, 5-, 10-, 30-year notes, and also the 'off-the-runs' in the 7- to 20-year maturity range. The Constant Maturity Treasury rates are also known as "Treasury Yield Curve Rates".

Yields on Treasury securities at "constant maturity" are interpolated by the U.S. Treasury from the daily yield curve, which is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market.

The CMT indexes are volatile and move with the market. They reflect the state of the economy, and respond quickly to economic changes. These indexes react more slowly than the CD index, but more quickly than the COFI index or the MTA index (see historical graph below).

1-Year CMT vs. 11th District COFI, 6-Month CD and MTA, 1991-2013
1-Year CMT vs. 11th District COFI, 6-Month CD and MTA, 1991-2013 { Obtaining Permission to Reproduce }

The following CMT indexes are the most often used for ARMs:

1-Year Constant Maturity Treasury index (1 Yr CMT)
This is the most widely used index. Roughly half of all ARMs are based on this index. It's used on ARMs with annual rate adjustments. It is also referred to as the 1-Year Treasury Bill (1Yr T-Bill) [see note], the 1-Year Treasury Security (1Yr T-Sec), or the 1-Year Treasury Spot index.

1-Year CMT Index vs. national average mortgage rate (start rate) on 1-year CMT-indexed adjustable rate mortgages, 1993-2013

1-, 3-, and 5-Year CMT, 1990-2012

3-Year Constant Maturity Treasury index (3 Yr CMT)
This index is less popular than the 1-Year CMT. ARMs based on the 3 Year CMT will adjust every three years (3 Year ARMs). It may be referred to as the 3-Year Treasury Security (3Yr T-Sec) index.

5-Year Constant Maturity Treasury index (5 Yr CMT)
Same as the 3 Year CMT, but ARM loans indexed to the 5 Year CMT will adjust once every five years (the ARM's adjustment period is usually the same as the security's constant maturity).

The CMT indexes are reported by the Federal Reserve Board.
Historical Data: Mortgage-X compiles historical values for the indexes which are widely used on adjustable rate mortgages (ARMs). Click here for a history of the most popular CMT indexes

If you need historical data prior to 1990, please visit the Federal Reserve Board website.

Note: The CMT indexes have both weekly and monthly values. If your ARM is tied to a CMT index, be sure to note whether it's weekly or monthly.

Constant Maturity Treasury: Frequently Asked Questions

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