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MBS RECAP: Bigger Picture Bounce or Just Another Pre-Weekend Pause

Posted To: MBS Commentary

Bigger Picture Bounce or Just Another Pre-Weekend Pause Bonds were moderately to sharply weaker overnight and deteriorated further in the afternoon. Given the strong move to 1.25% in 10yr yields the day before, you'd be well within your right to worry about a bigger picture bounce. That said, the bond market is also well within its right to sell off 6bps in Treasuries and 3/8ths of a point in MBS on the Friday before it has to buy $120 bln of bonds and digest a new CPI in the first 2 days of the following week. In other words, we may not get a great answer about big-picture bounces or pre-weekend pauses until next Wednesday. Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Market Movement Recap 08:28 AM Weaker overnight in a fairly linear move that started right at the open and continued…(read more)

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