MBS RECAP: No Glorious “New Month” Rally


Posted To: MBS Commentary

You never know… Sometimes the end of any given month will be skewed in one direction in terms of trading momentum only for the following month to see a surge in the other direction. We weren't expecting this to be the case, but given the renewed selling pressure last Wednesday, we certainly had part of the equation accounted for. As it happened, bond seemed almost careful to avoid making any gestures that could be construed as a reversal of last week's negative momentum. Case in point, even before this morning's ISM data, bonds bounced just before breaking through the floor that emerged on Friday afternoon. The data itself was unfriendly. The ISM Manufacturing PMI beat forecasts and came in at the highest levels since 2004. The inflation component also surged to the highest mark…(read more)

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