MBS Day Ahead: “Fun” With Chart Scaling: MBS vs Treasuries

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Posted To: MBS Commentary

Yesterday was one of the most boring trading sessions in recent memory. There were no meaningful market movers to discuss for the Treasury complex. And the only potential market movers proved to be almost meaningless. These included a tariff headline that simply referenced the implementation of a tariff change that was already announced and understood as well as the 5yr Treasury auction. As far as the bond market was concerned, bot of those events were forgettable (i.e. whatever movement they created was quickly erased). MBS couldn't have been happier with that situation. A narrow trading range and an absence of gains in Treasuries is just what the doctor ordered. The spread between MBS and Treasuries began to narrow in a noticeable way–arguably the most noticeable since the big spread…(read more)

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