MBS Week Ahead: Bonds Will Need at Least a Day to Get Back to Business

Posted To: MBS Commentary

New Years Day doesn't always fall on a day that allows for a 3.5-day weekend. When it does (as it did this year), the first day back to work tends to be an extension of the vacation for financial markets unless something significant happened over the weekend. Nothing significant happened over the weekend. All that to say that bond markets aren't walking in the door today and suddenly revealing clearly-defined trading biases simply because it's 2018. It will take at least a day before we see the beginning of "something new" for 2018, and it may well take a week or two. In any event, we can be certain that it is not being seen so far this morning. US and European bond markets are both simply extending the narrow trend channels seen heading into the end of last week. There's...(read more)

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