MBS RECAP: Too Soon to Assume, But Not to Hope

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Posted To: MBS Commentary

The notion of "hope" comes up quite a bit in my daily recap pieces–often because something bad is happening and we hope for it to end or because something good is happening and we hope it can continue. In today's case, it's both. Something good has been happening since November when bonds began to push back against the long-term high yields brought about by the strong economic data in Sept/Oct. That push-back blossomed into the best rate rally we'd seen in 2 years. Then something bad happened over the past 3 days as that rally experienced its most threatening push back, beginning with the strong jobs report last Friday. Combined with a Powell speech that soothed the stock market, this "bad thing" kicked off a mini-trend toward higher rates. Today is the first…(read more)

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