MBS Week Ahead: Central Bank Meetings and Fiscal Drama Keep Volatility on The Table

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Posted To: MBS Commentary

There are 3 to 4 big players this week when it comes to potential market movers . In no particular order, these include Treasury auctions, central bank announcements, inflation data, and potential tax headlines. The relative importance of any of these factors depends on reality versus expectations. For instance, with respect to the Treasury auctions (which occur earlier than normal this week with 2 today and 1 tomorrow), if demand metrics are in the middle of the range of historical averages and if the yield awards fall in line with expectations, we might not see much market movement at all. Contrast that with any potential tax bill headlines where a simple "yea or nay" has market moving connotations. In general, any news that makes it look like the tax bill is more likely/certain…(read more)

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