MBS RECAP: Single Best Trading Day Since The Election For Bonds

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Posted To: MBS Commentary

By quite a wide margin, today was the best day for bond markets since the election. 10yr yields dropped nearly 10bps, making it all the way to the important technical level of 2.34%. That's a nice move considering we're finally trading in the new year, thus shaking off much of the inconsistencies associated with year-end trading. In other words, we had the opportunity to read into the rally that took place on the last few days of 2016, but it's hard– even dangerous –to draw big-picture conclusions from that tiny pocket of activity. The start of the new year means market participation is getting stronger and volumes are getting bigger (today's 10yr futures volumes were nearly 3 times bigger than those seen on 12/28–the only other day that even came close to matching today's…(read more)

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