Posted To: MBS Commentary
Ever since bond markets failed to respond positively to yesterday morning’s exceptionally weak Durable Goods report, things have been almost exclusively negative . That anomaly provided a clue that has since been convincingly confirmed: it’s not about the data or headlines over the past two days. Once the rally reached levels coinciding with 10yr yields dipping into the mid 1.8’s, buyers simply stopped buying. Given the current, ongoing level of illiquidity in bond markets, it doesn’t take much to get snowballs rolling after a strong move in one direction. With rates improving almost exclusively for more than 2 weeks, we were arguably in the midst of a strong move through Tuesday. Once the selling takes hold in that scenario, it becomes its own reason for more selling. At this…(read more)
Via:: MBS RECAP: Another Day With Multiple Negative Reprices
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