MBS Week Ahead: The Pre-Brexit Pull-Back is Here

Posted To: MBS Commentary

Bond markets begin week significantly weaker as global markets back down on ‘Brexit’ trades 10yr yields created a big gap from last week’s levels This now becomes important resistance (aka “floor”) Brexit vote on Thursday After a fairly quick ramp in perceived importance (as far as major market events are concerned), we finally arrive at the U.K. referendum on remaining in the European Union this week (aka “Brexit”). Although the level of correlation has varied at times over the past few weeks, in general, this has been the dominant market mover in June, and a significant source of inspiration even before that. Last week, I began warning that markets looked like they had already reached the limit of how far they would move to price in Brexit without having actual…(read more)

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