MBS RECAP: It Could Have Been Worse

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Posted To: MBS Commentary

There was certainly some risk of volatility associated with the G20 summit over the weekend, even if no one expected it to produce any fundamental changes (either in the global economy or the market-based response). For such things to transpire, we'll need to see more substantive progress and a lot more TIME. The weekend's headlines concerning a trade war truce (and reopening of trade talks) between the US and China weren't entirely surprising, but they were still worth some bond selling in the overnight session. Things may have ended up even worse had it not been for economic data weakness and a subsequent bond rally in Europe. German 10yr yields surged to new all-time lows by the end of the European trading day, and that was the biggest positive input for US bonds. Apart from…(read more)

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