MBS RECAP: Bonds Go 3 For 3 on Friendly Developments


Posted To: MBS Commentary

There were three salient market movers for the bond market today with one of them being a 2-parter. First up was Brexit news in the overnight session. This began with a compromise deal looking more possible early on. The result was a move toward higher yields early in the overnight session (compromise + deal = soothing to market uncertainties = bad for bonds). By the time the sun was up in New York, the British Attorney General had thrown cold water on the deal and bonds were starting to recover . The recovery was bigger in Europe vs the US and most noticeable in British currency. US bonds were able to catch up with the rally after weaker-than-expected inflation data (CPI) at 8:30am ET. This took bonds easily into positive territory where they remained for the rest of the day. After fairly…(read more)

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