MBS RECAP: Surprisingly Informative Despite Boring Facade

Posted To: MBS Commentary

On the surface, today was a boring day for bond markets. 10yr yields ended less than a bp lower than yesterday's close and Fannie 3.0 MBS were completely unchanged. But as far as gleaning information, it wasn't a total loss. Late in the overnight hours, bonds sold-off somewhat abruptly as a big seller decided it was time to sell. Weakness lasted from roughly 6:33am to 6:58am ET and took 10yr yields from 1.76 to 1.788. At the time, all we knew is that sellers got cold feet as yields approached 1.80, but we didn't know if …read more