MBS Day Ahead: Big-Picture Waiting Game Continues

Posted To: MBS Commentary

Most financial metrics are almost always either MOVING or CONSOLIDATING . Those are pretty broad terms--especially when it comes to watching the market--but they need to be broad if we're only going to have 2 states of being for bonds! For the purposes of this discussion, "movement" refers to any trend where rates/yields are generally rising or falling over any length of time. In other words, the "movement" won't always be linear. We're just looking to apply a general label given a choice between the two. With all of the above in mind, and with yields right in line with late February's, we've definitely been in a consolidation phase for most of the year. Notably, if rates had continued higher in mid-May, that would have simply looked like a continuation...(read more)

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