Posted To: MBS Commentary
What a difference a day makes. With the recent trading range being so narrow, it didn't take much for the overall tone in bond markets to move from the gloomy side of the range to the optimistic. In this case, it was yesterday's ISM Non-Manufacturing data that served as the catalyst. The underlying trade here (and the reason this data had as much of an impact as it did in the current environment) was all about Fed rate hike odds. Fed Funds Futures completely erased the past 2 weeks of their trading range. The Jackson Hole speeches took rate hike odds to their highest level since before June 3rd, and the likelihood of a Fed rate hike in December is now lower than it was before Jackson Hole. Another way to look at the recent shift in Fed rate hike expectations is in 2yr yields (which...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
from Mortgage News Daily http://ift.tt/2bTAjzT
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