MBS RECAP: Bonds Officially Held January’s Range Ahead of March Fed Announcement

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Posted To: MBS Commentary

Bonds began the day in weaker territory following overnight headlines suggesting European leaders would be going up to bat for a compromise Brexit deal. "Less bad" economic data in Germany also contributed to European bond market selling. At the start of the domestic session–particularly the 8:20am CME Open–there was a glut of sell trades in the bond market. This resulted in what was, at the time, the biggest volume spike of the day (by far) and a noticeable uptick in yields. Technical levels were first to provide support with 10yr yields bouncing at 2.63%. After that, US/China trade headlines helped take yields to their lowest levels of the domestic session just before 1pm, though the rally proved to be short-lived. Bonds ended the day slightly weaker but close enough to 'unchanged'…(read more)

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