MBS RECAP: Bonds Trying to Make Their Case For More Gains

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Posted To: MBS Commentary

With the 2.95% level in 10yr yields being the most important pivot point for bonds at the moment, drifting sideways to close out the day around 2.948% is a bit of an equivocal message. On the one hand, that number is lower than 2.95%, and it took a 3bp rally to get here. That's good! On the other hand, that number essentially IS 2.95%. In other words, bonds have moved right onto the proverbial fence for tomorrow's NFP number. From there, we might ask ourselves how much NFP matters. While I'll certainly talk more about this tomorrow morning, it's safe to say that NFP always CAN matter, even if it's not in a trend of extreme importance at the moment. Last month's report was evidence of this, as the surprisingly weak result unequivocally helped rates improve. The same can't…(read more)

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