MBS Week Ahead: 10yr Yield Bottoms Out at 0.318%. What Next?

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Posted To: MBS Commentary

Overnight market panic made for some truly spectacular movement in the bond market with the 10yr Treasury yield down more than 40 bps at one point to 0.32%. That number is made all the more wild considering the previous all-time low was exactly 100bps higher in 2016. It's made even wilder considering that ground only took 7.5 days to cover, which is at least 1 day faster than the pace seen in November 2008 (the last time 10s moved 100bp lower in less than 2 weeks. In both cases, the previous low range was fairly well established. 2008's rally was facing off against lows from 2003, and multiple bounces near the same levels in 2008. The current version is accomplishing even grander things in that regard with solid bounces in both 2012 and 2016, very close to the same levels. There was…(read more)

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