The ECB released a policy announcement this morning.  They weren't expected to make any significant changes and indeed they made none.  Well, to be fair, they did remove a line about increasing bond purchases if the outlook worsened and there was a very small reaction at first (rates moved higher--mostly in Europe).  But Draghi's press conference--which is really what it's all about when it comes to ECB announcements--took bonds in the other direction.  

Draghi didn't say anything incredibly significant, but 2 comments resulted in noticeable upticks in volume and buying demand:

Comment 1: DRAGHI SAYS DECISION DOESN'T SIGNAL CHANGE IN EXPECTATIONS OR REACTION FUNCTION 

Comment 2: DRAGHI SAYS THERE WASN'T MUCH DISCUSSION ABOUT OTHER POSSIBLE CHANGES

The first comment was meant to address the removal of the bond-buying text as discussed above.  Draghi's point was that the text was from 2016, when the ECB felt like it needed to add extra psychological support and that the change in the text doesn't mean a change in their underlying willingness to do whatever's necessary to achieve their goals.  The second comment essentially reiterates the status quo nature of the policy decision.

The biggest move of the day arrived just as Draghi finished taking questions.  This suggests traders lined up to make certain trades and were simply waiting to make sure Draghi wasn't going to say anything that made those trades ill-advised.  Then, as soon as European bond markets closed, US bond markets weakened steadily through the 3pm CME close.  Thankfully, the weakness left a fair amount of the morning's gains intact.

By the end of the day, bonds had rallied enough and sold off enough to suggest they are as equivocal as possible heading into tomorrow's jobs report.  10yr yields failed to break the important pivot point at 2.85%, but they managed to avoid breaking above the 2.87% level (2.85%-2.87% has been this week's nearest pivot point, and is essentially smack dab between the recent range boundaries at 2.79% and 2.92%.


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
99-28 : +0-08
Treasuries
10 YR
2.8571 : -0.0259
Pricing as of 3/8/18 6:34PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
9:28AM  :  Bonds Liking Draghi So Far; Here Are The 2 Comments That Mattered

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Victor Burek  :  "*TRUMP METAL TARIFFS ARE SAID TO TAKE EFFECT IN 15 DAYS: AP *MEXICO, CANADA EXEMPTED INDEFINITELY FROM TARIFFS, AP REPORTS"
Bert Swyers  :  "def agree with JT, the wage component is all that matters"
John Tassios  :  "Wages component is what matters. NFP and UE are good for headlines in the news.@2cents"
Gerry Suarez  :  "I remember back when nfp meant something..."

Economic Calendar
Time Event Period Actual Forecast Prior
Friday, Mar 09
8:30 Average earnings mm (%) Feb 0.2 0.3
8:30 Non-farm payrolls (k)* Feb 200 200
8:30 Average workweek hrs (hr)* Feb 34.4 34.3
8:30 Unemployment rate mm (%)* Feb 4.0 4.1
10:00 Wholesale inventories mm (%) Jan 0.7 0.7