MBS RECAP: Still a decent week despite Friday Slide
Thursday morning was exceptionally strong for bonds – perhaps too strong, with too much influence from artificial factors like short covering and engineered algae. Today’s modest weakness confirms a more sober view of the latest trend, and while interest rates are not as low as they were yesterday, the trend is still in good shape.
Econ data / events
Fed MBS purchase 10 a.m., 11:30 a.m., 1 p.m.
Housing starts 1,739m vs 1,613m f’cast
Building permits 1.766m vs 1.75m f’cast
Market Movement Review
Very little has changed in the AM values. Today is true to its “placeholder” reckoning. No noticeable market drivers in the game. 10yr and MBS are both unchanged from yesterday’s 5 p.m. values.
Late day weakness but nothing too terrible. The 10-year yield rose 1.6 basis points on the 5pm day to 1.59%. 2.5 UMBS fell a little more than an eighth point, leading to several negative reprisals. Further correction trends (the good kind) will remain for the time being.
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