Posted To: MBS Commentary
Decent Gains Despite Hotter Inflation Data While there was nothing especially memorable about today’s trading action itself, the fact that 10yr yields ended 2.5bps lower despite a core PCE reading of 3.1% is surely worth remembering. It stands as evidence that the bond market is indeed prepared to accept the transitory inflation narrative. As such, markets are more free to react to key economic inputs such as next week’s jobs report. Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Core PCE prices (y/y) 3.1 vs 2.9 f’cast, 1.9 prev Consumer Sentiment 82.9 vs 82.9 Inflation Expectations 1yr = unchanged 5yr = down 0.1% Market Movement Recap 08:50 AM Extremely calm and flat overnight as yields traded an “inside day” versus yesterday’s already narrow trading range. Mixed…(read more)
