Posted To: MBS Commentary
It’s a sign of the times that the bond market responded with a modest rally following a stronger reading on CPI and a looming record-size 30yr bond auction this afternoon (not to mention stocks trading at all-time highs). Granted, yields are now 100bps higher than they were in September, and much of that 100bps has been an effort to get ahead of more growth/inflation/bond supply. The bigger questions surround the inflation/growth outlook several months down the road, as markets get an increasingly clear idea about what the post-covid economy looks like. Despite a relatively smaller move in the big picture, a quick spike in volume lets us know that the market is, at the very least, tuned in to the big ticket inflation reports. In fact, today’s data garnered a bigger response than the…(read more)
