MBS RECAP: Central Bankers and Corporate Issuance Not Helping

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Posted To: MBS Commentary

Bonds were weaker right from the start today as the overnight session saw several members of the European Central Bank comment on tapering prospects. Granted, they're not calling it "tapering." They're not even referring to any distinct event. Rather, the discussion is about the general notion of "not buying bonds." Whether they taper or quit cold turkey remains to be seen. The important turning point will be when something about the current gameplan changes. That's what today's speeches alluded to. This is timely because next week brings the ECB announcement. It was more of an issue today because two of the speakers referenced the market's expectations for the end of ECB bond buying. Moreover, both speakers went on to say that the market's expectations…(read more)

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