Uneventful Start to What May be an Eventful Week

When there are multiple examples of important events that can cause bond market volatility in any given week but that week begins without much volatility, the analysis writes itself.  The words may vary, but the underlying message is one of “calm before the storm.”  And because the storm involves multiple economic reports that stand some chance of offsetting their directional implications, it’s safer to say “calm before the potential storm.”  The most notable volatility today was driven by trades that existed due to month-end positional needs rather than a reaction to data/events.  Thus, the biggest moves were seen at 9:30am and 3pm, but ultimately didn’t leave trading levels far from Friday’s latest.

Econ Data / Events

Chicago PMI

42.8 vs 43.3 f’cast, 41.5 prev

Market Movement Recap

09:45 AM No major reaction to data.  10yr up less than 1bp at 4.02.  MBS down 2 ticks (.06).

12:51 PM modest additional gains with 10yr down 1.7bps at 3.996.  MBS up an eighth.

02:21 PM Leveled off in PM and slipping slightly.  MBS up 3 ticks (.09) and 10yr down 1bp at 4.003.

02:57 PM Giving up slightly more ground now.  MBS unchanged (down just over an eighth from highs) and 10yr also unchanged at 3.957.

Published On: July 31, 2023 / Categories: Mortgage News /