MBS Live Recap: Quiet Trading Week Leaves Focus on Brexit Weekend

Today was a throw-away day for the bond market.  Yields matched their narrowest trading range of the week and ended the day at their most 'unchanged' levels of the week (i.e. closest to the previous day's close).  In addition, Friday's close was only 2bps away from last Friday's close. 

Translation: bonds did a GREAT job of QUICKLY getting into position for upcoming risks after LAST WEEK'S Brexit news.  You'd be forgiven if you forgot about this one already, but I'm referring to the meeting that took place between Boris Johnson and the Northern Irish PM Varadkar.  That meeting introduced the prospect of a last minute Brexit deal.  Bonds jumped accordingly (perhaps with some help from the trade deal announcement the following day) and the waiting game began.

As of tomorrow, the waiting game--or at least a major milestone thereof--is over.  We'll find out if British parliament can manage to sign off on the new Brexit deal (the average news story this week suggests they won't, but we've learned not to blindly trust such stories when it comes to how UK politics will go).  More likely, we'll find out that the UK will request a 2 month extension on the existing 10/31/19 Brexit deadline.  Happy New Year?