Here is the primer on Corporate Bond Issuance for those who need it.  I realize it's been linked in almost every post this week, but that's the kind of week it is.  Keep in mind that the first few minutes of Monday morning saw Microsoft launch a corporate bond that was bigger than the total amount seen on some entire weeks.  But even without that $19+ billion deal, smaller offerings have combined to nearly equal that amount over the past 2 days.  Some quick math tells us that's roughly $38 billion in new debt being brought to market in 3 days, putting this week on pace to be one of the three busiest ever.

Think about corporate bonds as--simply--"bonds."  Then think about "supply" in terms of econ 101.  Higher supply = prices fall.  Ergo, a deluge of corporate bond supply brings prices lower in bond markets, all things being equal.  So the fact that Treasuries and MBS are in positive territory this afternoon means 2 things.  Mostly, it means that markets were generally aware that this would be a busy week of corporate issuance.  Secondarily, however, is means that there's some desire for bonds to hold inside the recent range without simply "giving up" and heading toward higher yields.

Key events over the next 2 days could be the reason bonds are sticking around.  Right at the start of the domestic session tomorrow, we'll have the Bank of England back with its second policy announcement since Brexit.  They're widely expected to cut rates and increase accommodation.  Bonds may be cranky if that doesn't happen.  Then Friday brings NFP, which could certainly inform the Fed rate hike outlook for the rest of the year.  


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
103-25 : +0-03
Treasuries
10 YR
1.5450 : +0.0080
Pricing as of 8/3/16 5:50PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:22AM  :  Super Sneaky Post-10am Market Movement (It's Not ISM!)

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Sung Kim  :  "right, and that's the problem, they look at this world like it is the same world when they started measuring inflation"
Matthew Graham  :  "I think you could make a case for inflation either way. Paradoxically, higher inflation of basic necessities is economically negative. Fed is looking for inflation that drives the economy. Instead, we just have inflation that further fuels the wealth gap."
Matthew Graham  :  "http://www.pricestats.com/inflation-series?chart=1837# may be more up to date"
Matthew Graham  :  "http://bpp.mit.edu/usa/"
Sung Kim  :  "can you expound?"
Matthew Graham  :  "MIT BPP traces government inflation data fairly well. There can be a lot that goes into those numbers that we don't stop and think to consider from our armchair analytical perches."
Dan Shapiro  :  "remember how the FEDs changed their inflation data... how convenient"
Sung Kim  :  "i totally disagree there is no inflation. as long as other countries keep on passing the baton of econ issues, Fed won't raise no matter what they say. stocks are petering out and probably trades lower this month, so that is going to completely kill sept hike and then fall seasonal slow down plus elections gonna kill decemebr"
Sung Kim  :  "there is massive inflation, it's just not being measured"
Christopher Stevens  :  "RB even if you are you should check investor overlays if your not selling direct"
B C  :  "now is in 2024"
Ray Blindauer  :  "Is anyone seeing findings in DU where a condo cert is not necessary?"
Matt Hodges  :  "ha! predictions of inflation by the Fed continually without historical accuracy"
Ted Rood  :  "So we'll basically hit inflation target two years from now, whenever "now" is?"
Matthew Graham  :  "RTRS - FED'S EVANS SEES INFLATION REACHING 2 PCT BY END OF 2018"
Matthew Graham  :  "RTRS - CHICAGO FED'S EVANS SAYS ONE U.S. INTEREST RATE INCREASE THIS YEAR COULD BE APPROPRIATE"