MBS RECAP: 2nd Best Day in More Than 2 Months

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Posted To: MBS Commentary

The last time trading levels in bond markets were this strong at the close of business, it was on the most dire day of the Italian political drama–the one that caused 10yr yields to drop all the way into the 2.7's . The last time before that was in the middle of April. In some ways, even though this is only the "2nd best" day since then, it's actually more of a positive indicator for bonds because we've approached it in a calmer way this time around. Case in point, a 30bp rally took 2 days when Italy was driving the gains. This time around, it's take 2 weeks to cover the same ground. Granted, there's still a bogeyman on center stage as far as financial markets are concerned. "Trade war" and other trade-related headlines are having a fairly big impact…(read more)

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