Posted To: MBS Commentary
Bond Weakness Reinforces The Consolidation Pattern Bonds were weaker overnight and the selling trend continued fairly steadily throughout the day. The only exception was a bigger yield spike that coincided with (but wasn’t necessarily caused by) the EU close. It is worth noting, however, that yields topped out the moment after the EU closing bell and have been sideways in a narrow range since then. Jargon terms like “position squaring” and “illiquidity” certainly can’t be ruled out here, but we can’t really act upon such conclusions without seeing how bonds are trading on Monday morning. Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Core Producer Prices: (y/y) 6.7 vs 6.6 f’cast, 6.2 prev (m/m) 0.6 vs 0.5 f’cast, 1.0 prev Market Movement Recap 08…(read more)
