MBS RECAP: Why Are MBS Unchanged if Charts Don't Look That Way

Posted To: MBS Commentary

Bond Market Breakout is Here (The Bad One) For days–and especially since last Friday–we've been increasingly worried that the 2-month bond rally was running out of steam and at risk of a reversal. The jury was technically out until all of our overhead ceilings were taken out. As of today, they are. Econ Data / Events 20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th) Core Consumer Prices (y/y) 1.6 vs 1.1 f'cast, 1.2 prev Market Movement Recap 08:23 AM Bonds were weaker overnight with most of the damage arriving with the European session and strength in equities markets (i.e. " risk-on " move). Weakness extending this morning with higher CPI not helping. 10yr up 4.6bps and UMBS 2.0 down a quarter point. 10:04 AM Modest recovery for bonds after bouncing off the…(read more)

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