MBS RECAP: Departure of European Guests Has Bonds Feeling Blue (or Red)


Posted To: MBS Commentary

MBS Live folks don't need to be reminded that red is not our favorite color. It connotes bond market losses on the MBS Live dashboard (and losses in general, of course). We saw plenty of it today despite the absence of any meaningful news, econ data, or other developments that would typically prompt such a selling spree. What gives? In this case, it's pretty simple and fairly well foreseen in my analysis last week. Specifically, I said we'd need a fresh supply of European drama (or other equivalent market mover) in order to merely maintain the gains we'd already seen, let alone improve upon them. Instead, we've seen the European drama dry up , for the most part. If Treasuries had been having a great time partying with their European friends, it increasingly looks like party…(read more)

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