With two big-ticket events on tap for bond markets today, there was always a chance that they'd go our way and that we'd see some decent gains as a result.  Thankfully, that happened.

In fact, bonds were already moderately stronger before the first big event--The Consumer Price Index (CPI)--crossed the wires.  Following the weaker CPI reading yields moved quickly lower in the highest single-minute volume since February's CPI release.  Unfortunately, the resulting rally didn't have enough momentum to break through the 2.95% technical level--a pesky floor for 10yr Treasury yields over the past 3 weeks.

Still, the day could still be salvaged if a strong 30yr Bond auction helped yields come around for another attempt.  Indeed the auction was on the strong side.  This is all the more notable because, of the two types of bond auctions (refundings vs reopenings), today's refunding had much stronger stats when compared to other refundings.  

The strong auction logically helped bonds rally again in the afternoon, but here too, there was no noticeable attempt to challenge that 2.95% floor in 10yr yields.  In fact, yields didn't even make it back to the morning lows.  This begs the question: was today's 3-4bp improvement enough given that bonds got all the good news they'd hoped for and were still unable to break that technical floor?  At the very least, we can say that answering "yes" to that question is pretty risky.  


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
99-07 : +0-09
Treasuries
10 YR
2.9640 : -0.0310
Pricing as of 5/10/18 4:32PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
1:10PM  :  30yr Auction Relatively Strong; Bonds Improve
8:40AM  :  CPI Brings BIG Volume; Bonds Improve

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "A is fair"
Matthew Graham  :  "
MBS Live Update Issued
30yr Auction Relatively Strong; Bonds Improve"
Andy Pada, Jr.  :  "A?"
Matthew Graham  :  "only strong from 8:30-9am. Average since then"
Jeff Anderson  :  "I'd say the buying volume has tailed off. :)"
John Tassios  :  "MG, volumes still strong or is it tailing off?"
Ira Selwin  :  "Check out that article in the news stream "Burned-out house in Silicon Valley sells for a whopping $938,000""