Without month-end trading needs and in the absence of one of the most relevant inflation reports, today may well have been a typically slow summertime trading session.  In fact, relative to other times of the year, it still managed to be fairly slow.  But relative to the past 2 weeks, it was one of the more actively-traded sessions.  That's saying something considering bonds generally solidified gains that ostensibly occurred in response to North Korea headlines.  

The implication (and something we discussed yesterday) is that bonds have to "want" to be in the current range to some extent.  At the very least, they have to not have a burning desire to leap back toward higher levels.  

The month-end trading environment complicates that assessment just a bit because we can never really know how much of a sugar-high it's providing for bonds.  We've seen it go both ways, so I wouldn't necessarily say it's the only reason we're as low in rates as we are, but it definitely "helped" over the past few days.

This morning provided an example as fairly middle-of-the-road data (flat PCE inflation) preceded rallies in both stocks and bonds.  The big spike (relative to today's range) at 3pm is more evidence that month-end trading is playing a big roll because 3pm is the close of business for CME pit hours, and a self-imposed deadline for quite a few bond traders outside the pit.

10yr yields ended the day down 1.6bps at 2.121 and Fannie 3.5 MBS added 3/32nds (.094) to close at 103-20 (103.625).