MBS RECAP: Bonds Expecting Quite a Lot From The Fed

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Posted To: MBS Commentary

There were a smattering of headlines and events available for bond markets to digest today. If rates ended up moving higher, we could likely find a way to present those tidbits in such a way as to reconcile the bond market weakness. As it happened, rates moved lower . The bond market strength is fairly logical given the weak economic data, Brexit-related headlines, Treasury/corporate supply considerations, and potential month-end buying. But the biggest factor in play is likely tomorrow's FOMC Announcement, and bond traders are expecting it to be decidedly friendly. On the one hand , the last announcement wasn't nearly as friendly as expected. Shortly thereafter, various Fed speakers came out and said the dovish things traders had hoped to hear/see at the announcement. In other words…(read more)

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