MBS MID-DAY: Bond Markets--Especially Treasuries--On Back Foot Ahead of 10yr Auction/FOMC

By: Matthew Graham •

The overnight session was calm.  Japanese trading helped Treasuries a bit, and European hours did some damage.  Bonds started the domestic session in just barely weaker territory, improved briefly, and have been selling off ever since.

It's fairly evident from this morning's tradeflows that Treasury traders have more than a little bit of anxiety about the auction coming up at 1pm.  Combine that with general anxiety over the Fed minutes an hour later and we find ourselves most of the way back to yesterday's weakest levels.

That's not a super scary phenomenon though, considering the 2-day trading range is pretty narrow.  With Treasury yields pushing up against yesterday's highs, we'd like to see those hold after the auction.  That would make a solid case for 1.92 as a short-term inflection point, as it was the low on March 31st (i.e. hoping it's a ceiling instead of a floor this time around).

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
102-11 : -0-02
FNMA 3.5
105-04 : -0-02
FNMA 4.0
106-28 : -0-01
Treasuries
2 YR
0.5320 : +0.0120
10 YR
1.9230 : +0.0370
30 YR
2.5590 : +0.0390
Pricing as of 4/8/15 12:41PMEST
Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
11:41AM  :  ALERT ISSUED: Negative Reprices Increasingly Possible
11:14AM  :  ALERT ISSUED: On the Edge for Potential Reprice Risk
9:37AM  :  Back Into Negative Territory After Tepid Overnight Gains
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A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
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