Posted To: MBS Commentary
Inflation Expectations And Weaker Econ Data Helping Bonds Ever since last week’s CPI data caused inflation expectations to surge, they’ve been staging for a return to earth–one that’s largely occurred over the past 2 days as traders increasingly bet on transitory inflation. This morning’s weak Philly Fed numbers kept that trade alive, as did the afternoon’s 10yr TIPS auction. As for yields themselves, they were largely flat after early gains, but the early gains were very respectable with 10yr yields dropping roughly 4bps. This keeps us very much inside the range of the past week (1.62-1.69). Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Jobless Claims 444k vs 450k f’cast, 478k prev Philly Fed Index 31.5 vs 43.0 f’cast, 50.2 prev Market Movement Recap 08:50…(read more)
