MBS Live Recap: Uneventful Start to Short Week; New Loan Limits Tomorrow?

Attempting to competently perform bond market analysis on Thanksgiving week is a dangerous game.  It will either drive a person insane(r), or simply lead to great frustration.  So I'm taking a break from past routines in favor of conducting my least favorite form of analysis: objective play by play.

Actually objective play by play is always a part of what I do anyway.  The difference on a week like this is that it's fairly futile to assign significance to any particular movement or to attempt to understand the underlying causes.  

Today, for instance, bonds were slightly weaker overnight but quickly returned to positive levels at 9am.  The move was obviously "something" based on volume and volatility, but the world may never know what that "something" was (I've talked about it a fair amount already in the day's commentary on MBS Live).  Nothing has happened since then.  The end.

If we want to talk about something notable and interesting, here's a reminder: tomorrow likely brings the announcement of new conforming loan limits.  As of 2012 (when prices had bounced back enough from the crisis), this happens every year around this time.  Tomorrow's FHFA home price data is the last ingredient necessary for the calculation to take place.  If price trends were to continue at exactly the same pace, the target number is somewhere around $497k, best I can tell.  Hopefully we'll know tomorrow, but even then, the new limits wouldn't go into effect until 1/1/2020.