Bonds started the day with a test of the key technical cap at 1.37% in 10-year returns. With a little help from the geopolitical risk from the bombings in Kabul, the bonds managed to stay pretty calm for the 10 years, just a hair better than “unchanged” at 3:00 PM CME. MBS also found a foot and was 2 ticks (0.06) higher at the same time. But we’re not out of the woods yet. Fed Chairman Powell’s Jackson Hole speech will take place tomorrow afternoon. More than a few traders have been marginalized for this event this week. You’re ready to get back on track (either as a buyer or a seller) based on what Powell says.

  • Fed MBS purchases 10 a.m., 11:30 a.m., 1 p.m.

  • Unemployment claims 353k vs 350k f’cast, 349k prev

  • Q2 GDP (1st revision) 6.6 vs 6.7 f’cast

09:48 am

Slightly stronger and mostly flat during the Asian lessons, followed by a moderate weakness during the European session. 10-year yield is 1.356, which is less than 1bp. UMBS 2.0 coupons are down 6bps (2 ticks). No significant data in this AM.

12:54 p.m.

Bonds back in negative territory ahead of the 7-year Treasury auction. 10 years rose 1bp to 1.359 and UMBS 2.0 fell almost an eighth point.

1:20 p.m.

A hair stronger after a decent 7 year auction. Bonds are now roughly unchanged at 10 years just above 1.35% and MBS + 0.00 at 101-03 (101.09).