MBS Day Ahead: It's Still Serious, and For The Exact Same Reasons

Posted To: MBS Commentary

You might remember some seemingly dramatic headlines from early September when rates attempted their first big break of the dominant range (e.g. " Yes It's Serious. Suit Up. Man Battle Stations" ). While we enjoyed a refreshing little recovery following the FOMC Announcement, it turns out that things are still serious , and for the same reasons they were serious several weeks ago (i.e. the possibility of a potential ECB taper tantrum creating an ongoing uptrend in rates that may have already begun): Back then, most of the available coverage was focused on the wrong things--especially the silly notion that the late scheduling of a speech by Fed dove Brainard meant that she was about to defect to the hawkish camp and drop a rate-hike bomb a few days before the Announcement. Talk...(read more)

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