MBS RECAP: Bond Market Alarm Malfunctions; Slept-In All Day

On the morning after 'springing forward,' we could forgive a bit of confusion or a bit of fatigue as folks who use archaic alarms may have been running a bit late today.  But domestic bond markets didn't even show up at all.  This was so painfully obvious in light of the massive move in European bond markets. 

With the ECB beginning bond purchases today, it soon became clear that European bonds were having that initial rush associated with the first use of the QE drug.  German Bunds weren't quite prepared for it, and rallied handsomely.  But check out the chart below!  Even during the sharpest spike of the morning, Treasuries were simply sleep walking meagerly back down from Friday's lofty heights.

MBS similarly held inside a super narrow range.  Nary a headline or event caused much of a stir. But rather than wonder whether or not this is the first day of a bounce back, it would probably make more sense to ask if this was just an unofficial 3rd day of the weekend.  The answer is probably 'yes,' but we'll know more tomorrow.