Mortgage-backed bonds from Fannie Mae, Freddie Mac and Ginnie Mae gave investors smaller returns than comparable U.S. government debt last month, as bond buyers anticipated a flood of refinancing by homeowners eager to take advantage of low interest rates. Government-backed mortgage bonds returned 34 basis points less than Treasurys in August, the biggest underperformance since November 2008, according to Barclays Capital indexes.

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