Broadly Sideways Despite Intraday Volatility

Shorter term bonds lost ground today while longer term bonds and MBS managed a modest victory. While this isn’t really a victory considering the mixed performance, it was better than a sharp stick in the eye.  Moreover, MBS were able to outperform–something that is not at all uncommon on the first few days of a Treasury auction week.  In the bigger picture, yields are hugging the upper boundary of a trend that would seem fairly boring and only slightly weaker over the past few months after breaking sharply below and above that trend after the tariff announcement drama. 

Econ Data / Events

Leading Indicators

-0.7 vs -0.5 f’cast, -0.3 prev

Market Movement Recap

09:50 AM Moderately stronger overnight after initial weakness. MBS up 5 ticks (.16) and 10yr down 4.378.

01:15 PM Fairly weak 2yr auction.  Some additional selling, but still stronger on the day.  MBS up 6 ticks (.19) and 10yr down 2.2bps at 4.387

03:30 PM Sideways near same levels.  MBS up 5 ticks (.16) and 10yr down 1.5bps at 4.395