Posted To: MBS Commentary
After today, we're left with a clearer picture of the prevailing short-term range in bond markets. The volatile reaction to the weekend's Italian referendum, among other things, drove the intraday extremes that helped define the pattern. The first trade during Asian market hours was logical . Bonds rallied because Italy voted "no" on the referendum. Regardless of the facts underlying the referendum (different implications could be argued for either result), a "no" vote was generally considered to increase uncertainty, chiefly because it likely paves the way for a new government. To oversimplify, a "no" vote in the Italian referendum became roughly analogous to a Trump vote in the US election. Much like election night in the US, bonds' first move was...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
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