Every Bit As Quiet As It Was Supposed To Be

There's really no way to predict the future when it comes to rate movement in the coming days/weeks.  But there are some times when probabilities are higher than normal for a certain baseline trend.  In the case of late December, that baseline is for yields to hurry up and wait in a sideways pattern for more liquidity and more information on how omicron is playing out.  Neither of those things will be in abundant supply for at least a week, so today's exceptionally flat performance is no surprise (or simply, less surprising than other potential outcomes).

Econ Data / Events

  • Fed MBS Buying 10am, 11:30am, 1pm

  • Case Shiller Home Prices 18.4 vs 19.1 prev
    FHFA Home Prices 17.4 vs 17.7 prev

Market Movement Recap
08:36 AM

Carbon copy of yesterday's overnight session.  Flat in Tokyo.  Closed in London.  Roughly unchanged at domestic open.  No major market movers.

11:21 AM

AM gains hit resistance around 9:30am and we've been flat since then.  10yr yields down 1bp at 1.467 and 2.5 UMBS up 3 ticks (0.09) at 102-05 (102.16).

01:58 PM

Moderate weakness after 5yr Treasury auction, but mostly in Treasuries.  MBS are down 3 ticks (0.09) from the highs.  10yr yields are now up half a bp on the day at 1.482.

04:27 PM

Bonds found footing shortly after the last update and have been sideways ever since.  MBS back up to +3 ticks (+0.09) on the day.  10yr yield effectively unchanged.