Every Bit As Quiet As It Was Supposed To Be
There’s really no way to predict the future when it comes to rate movement in the coming days/weeks. But there are some times when probabilities are higher than normal for a certain baseline trend. In the case of late December, that baseline is for yields to hurry up and wait in a sideways pattern for more liquidity and more information on how omicron is playing out. Neither of those things will be in abundant supply for at least a week, so today’s exceptionally flat performance is no surprise (or simply, less surprising than other potential outcomes).
Econ Data / Events
Fed MBS Buying 10am, 11:30am, 1pm
Case Shiller Home Prices 18.4 vs 19.1 prev FHFA Home Prices 17.4 vs 17.7 prev
Market Movement Recap
08:36 AM Carbon copy of yesterday’s overnight session. Flat in Tokyo. Closed in London. Roughly unchanged at domestic open. No major market movers.
11:21 AM AM gains hit resistance around 9:30am and we’ve been flat since then. 10yr yields down 1bp at 1.467 and 2.5 UMBS up 3 ticks (0.09) at 102-05 (102.16).
01:58 PM Moderate weakness after 5yr Treasury auction, but mostly in Treasuries. MBS are down 3 ticks (0.09) from the highs. 10yr yields are now up half a bp on the day at 1.482.
04:27 PM Bonds found footing shortly after the last update and have been sideways ever since. MBS back up to +3 ticks (+0.09) on the day. 10yr yield effectively unchanged.