Posted To: MBS Commentary
Reasons For Both Hope and Caution Today’s 10yr auction was average, but that performance followed a mid-day bond rally. In other words, the auction likely would have been stronger if not for that rally. On one hand, it’s encouraging to continue holding ground without a new, abrupt sell-off so far this week. On the other hand, we really need to see a stronger commitment to rally before getting too hopeful. Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm Core CPI (y/y) 1.3 vs 1.4 f’cast, 1.4 prev Market Movement Recap 08:45 AM Weaker overnight, with Treasuries following European yields higher. Nice little jolt of gains after the weaker CPI data, but that’s mostly unwound now. 10yr yields up 2.3bps at 1.55% and 2.5 UMBS down just over an eighth at 103-06 (103.19). 10:35 AM…(read more)
