MBS RECAP: ‘Tis The Season


Posted To: MBS Commentary

Bond markets got off to a seasonally typical start this week with volumes and volatility both virtually nonexistent. There are past instances of volatility during the last week of the year, but in general, the default stance is purely neutral (for the traders that are even tuned in). Technically, we did see some modest gains today, but they fit well within the trading range established when bonds leveled off late last week. Anything between 2.46 and 2.49 fits inside that range. In terms of MBS, Fannie 3.5 coupons traded at 102-10 or 102-11 for most of the day. The only economic data of note was the Case Shiller Home Price Index. It doesn't move markets even during busier times of year. It was only notable because it continues to convey better-than-expected home price appreciation. The Treasury…(read more)

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