MBS Day Ahead: Bonds Stalled Despite Stocks. What Are They Waiting For?

Posted To: MBS Commentary

Although yields have risen modestly over the past 3 trading session, they've done so from the best levels in more than 7 months. If we take a few steps back from the narrow time frame that we watch from day-to-day and think about the broader recent context, the 2.23-2.25% range of the past few days looks pretty good. After all, we'd been tracking a range of 2.3-2.6, give or take, for most of 2017, and have discussed on several recent occasions that it could take some time for bonds to come to terms with a break outside that range. But is that definitely what's going on here? Are the 2.23-2.25% yields indicative of more strength to come or do they hearken a bounce? If you were to ask equities markets or even European bond markets, they'd suggest we should already have bounced...(read more)

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