We've discussed the tenor of Thanksgiving week in bond markets being more to do with serendipity than traditional "cause and effect" relationships.  That means the events and data on the calendar that typically push and pull on bonds throughout the course of the day are less relevant than normal.  Instead, it's the sometimes random, sometimes counter-intuitive tradeflows preceding a 4-day weekend that set the tone.

And sometimes the seemingly random trades DO happen to line up in an intuitive way with the economic data and events.  Today was one of those days.  Both Durable Goods and Consumer Sentiment provided ways to justify bond buying.  The only catch is that the bulk of bond buying didn't happen in direct response to either data release.  Still, we can at least say the data "didn't hurt" the rally that was already underway.  

The afternoon brought the Minutes from the most recent Fed Announcement.  Let's ask ourselves: what more could the Fed possibly do to convey an impending rate hike in December?  That's right!  Effectively nothing, and markets are already priced for that reality.  In that light, anything the Fed said today could arguably serve as bond buying motivation.  Indeed, bonds improved right after the Fed, but so many traders were already gone for the weekend that it doesn't make much sense to put much stock in that reaction--especially because it didn't carry yields outside the established ranges we've been watching (in a nutshell 2.3-2.4% in 10yr yields).

Bigger decisions will be reserved for the coming weeks as Congress tries to get a passable tax bill on the President's desk before the end of the year (and their year ends halfway through December).


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 3.5
102-29 : +0-08
Treasuries
10 YR
2.3223 : -0.0387
Pricing as of 11/22/17 4:38PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:14PM  :  Bonds Rally on Fed Minutes (Includes Bullet Points)
12:37PM  :  Bonds Improve, Mostly Serendipitously and Inconsequentially
8:44AM  :  Durable Goods Much Weaker, But Limited Reaction in Bonds

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Sung Kim  :  "Everyone have a Happy Thanksgiving"
Matthew Graham  :  "and even then, it's too easy to discount any additional movement today because traders are dropping like flies."
Matthew Graham  :  "tl;dr, sure, inflation expectations may have provided a boost, but can't read much into econ data if Durables produced no response from 8:30-8:35am, and in general while bonds remain range-bound."
Matthew Graham  :  "
MBS Live Update Issued
Bonds Improve, Mostly Serendipitously and Inconsequentially"
Matthew Graham  :  "Here's my take JT:"
John Tassios  :  "MG - 12:23. My own view is once U Mich came out and saw inflation expectations of consumers plus the big drop in CapEx,. Infl and Infl expecations still very low, flattening Yield curve will continue into 2018. @ 2cents."
Matthew Graham  :  "correct!"
Christopher Stevens  :  "It's a lot to chalk anything up to this move"
Matthew Graham  :  "Yellen was yesterday night at 6pm. Bonds didn't react at all. Then they sold off hours later. Now they're rallying. It's a lot to ask to chalk any of this move up to Yellen."
Jason Anker  :  "new Yellen comments?"