Posted To: MBS CommentaryBig Swings as Covid Squares Off Against The Fed It was omicron vs the Fed today and bonds had a front row seat. In the overnight session, comments from Moderna’s CEO (lower vaccine efficacy expected for omicron variant) sent stock prices and bond yields screaming lower. Then at 10am during a congressional testimony, Powell hit bonds with a one two punch, saying it was time to retire the word “transitory” when referring to inflation, and that tapering could need to be accelerated. The latter was a shot across the bow for the short end of the yield curve as it implied earlier rate hikes. MBS took the news far worse than Treasuries. Econ Data / Events Fed MBS Buying 10am, 11:30am, 1pm Case Shiller Home Prices (y/y) 19.1 vs 19.3 f’cast, 19.6 prev FHFA Home Price (y/y) 17.7 vs…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.