MBS Day Ahead: What's The Next Ceiling For Bond Yields?

Posted To: MBS Commentary

There are several ways to look at "the range" when it comes to post-covid trading levels in the bond market. There are several ways to look at "the bond market" for that matter, but as usual, we'll focus on 10yr yields even though this is an MBS site ( here's why ). In the bigger picture, yields are still in a very low, very narrow range with historically light volatility. Up until the end of September, we could even say that shorter time horizons were also boasting exceptionally low, narrow ranges. 0.62 – 0.72 was a prime example, and it was intact for nearly 2 months starting in early August. Over the past 3 weeks, however, yields have clearly been on a mission to move toward higher levels. After .72, it was a very easy call to name 0.79 the next ceiling on the…(read more)