MBS Day Ahead: The Fed Rate Cut Has Basically Already Happened

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Posted To: MBS Commentary

In the day just passed, bonds put in one more day of slow, illiquid summertime trading. Granted, volumes were slightly better than the previous session, but the previous session saw the 2nd lightest volume in more than 3 months. The morning's economic data brought additional apparent volatility. This was especially evident right after the big beat in Consumer Confidence at 10am, but all of that volatility occurred well within an EXTREMELY narrow range. In the day ahead, the Fed Announcement at 2pm is clearly the headliner although the morning's economic data could put a bit of spin on the ball. Said spin would be fairly limited if yesterday was any indication, however. The following chart shows this week's trading range (dotted white line box) relative to last week's. I like…(read more)

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