No Whammies in Fed Minutes, Geopolitics, or Bond Volatility

Today ended up being one of the least volatile trading sessions for the bond market since last week's CPI/Bullard/Ukraine-induced surge.  Overnight newswires called into question yesterday's news regarding Russian troops returning to base.  With that, bond yields fell to their lowest levels of the day with the 10yr almost breaking below 2.0%.  Bonds slowly returned to unchanged levels to await the Fed Minutes at 2pm.  The minutes themselves were entirely unremarkable for anyone paying attention to the initial announcement back in late January.  Markets ultimately agreed after a brief spat of volatility.

Econ Data / Events

  • Fed MBS Buying 10am, 11:30am, 1pm

  • Retail Sales 3.8 vs 2.0 f'cast, -2.5 prev
    Industrial Production 1.4 vs 0.4 f'cast -0.1 prev
    NAHB Builder Confidence 82 vs 83 f'cast, 83 prev

Market Movement Recap
08:25 AM

Little-changed overnight after trading 2 ways (modest gains in Asia followed by a push-back in Europe).  10yr yields down less than 1bp at 2.035.  MBS still trying to find liquidity, but should be roughly unchanged when they do.

09:07 AM

Losses reverse course after Blinken says there's no evidence of Russian troop pullback (and that critical units are moving toward the border, not away).  MBS up 6 ticks (.19) and 10yr down 3.6bps now at 2.007.

02:26 PM

Some weakness leading up to the Fed Minutes release, but a decent recovery afterward.  MBS not quite back to previous highs, but still in positive territory (2 ticks or 0.06).  10yr yields down almost 1bp at 2.036.