MBS RECAP: Central Banks Push Back on Recent Rally

Posted To: MBS Commentary

Take market analysis with a grain of salt today. To a much greater extent than yesterday, market-watchers would have to dig to connect the dots between news/events and market movement. Volumes were lighter and the shuffling of trading positions looks to have played as big a role as anything else. With that out of the way, let’s connect the dots as best we can. Right out of the gate, a headline from an unnamed ECB official (saying a tapering announcement was likely at the September meeting) pushed bond yields noticeably higher. This occurred just after 7am and resulted in bonds opening weaker for the domestic session. 8:30am economic data wasn’t very interesting as far as traders were concerned. The data also didn’t happen to fall very far from forecasts. The next noticeable move…(read more)

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