Relative to Friday's trading ranges, MBS are outperforming Treasuries. Fannie 3.5s are at their highest levels since Tuesday while Treasuries have yet to break today's existing low yields.
The morning has been relatively uneventful so far, with bond markets generally extending the rally that began at 9am on Friday. None of the economic data has had much of an impact. It was stronger-than-expected across the board yet didn't make for any pronounced selling pressure.
Interestingly enough, the release of the IMF's updated forecasts for the US may have been the turning point in a morning that--until that point--had been trending weaker. It wasn't much of a surprise to see full-year GDP forecasts revised lower thanks to Q1 revisions.
Perhaps more interesting was the IMF's call for potential growth to remain near 2% for the next several years--notably less optimistic than most (some would argue "more in line with reality"). To be clear, this wasn't a big market mover. Rather, it simply might be helping bond markets hold their ground on what was already a pretty calm trading day.
Join Now or Login to Post Comments