MBS RECAP: 9th Straight Day of Weakness and More Risk Ahead


Posted To: MBS Commentary

The title sums it up. Bonds are having a bad time . Fed rate hike expectations started this unpleasant party last week and economic data added to the drama this week (chiefly, Wednesday's ADP employment data). This morning saw fairly modest pressure from the overnight session and the morning's press conference with European Central Bank (ECB) president Mario Draghi. Long story short: Draghi was a bit more hawkish than expected. His hawkishness was reiterated in the afternoon when newswires suggested he'd spoken to EU leaders about the need to get their fiscal houses for the day when the ECB isn't in the stimulus business. Some combination of that news and several headlines regarding the impending debt ceiling showdown pushed bonds to even weaker levels in the afternoon. These…(read more)

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