Grandparents will always have at least a few stories about "the way things used to be."  Those old ways may seem inefficient, strange, wonderful, or all of the above to the younger generation.  For market watchers, the generational divides aren't measured in 2-3 decades but rather 2-3 years (and sometimes 2-3 days!).  

With that in mind, our market-watching forebears have stories of this stuff called "economic data" that was released on a set schedule.  When the data was released, bond would often react predictably.  For example, data that suggested economic weakness would help bonds and vice versa.

It turns out economic data is still a thing!  It just hasn't been on the current generation's radar, apart from a few key exceptions like Nonfarm Payrolls and CPI.  But today's Philly Fed Index hearkened back to that bygone era were other 2nd tier reports mattered.  

Part of the reason for this throwback was the size of the "miss" combined with the most recent ceiling (seen in the previous report).  Taken together, they suggest some small risk of an economic shift (as discussed in the Day Ahead).  This helped bonds extend a rally that was already in the works from the overnight session.  Gains were held without much fanfare, but they never challenged yesterday's stronger levels.  The net effect is yet another day of consolidation in the middle of the range set by Italian volatility of late May.  Bottom line, we're still waiting for that consolidation to break, but at slightly better levels than yesterday. 


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 4.0
101-24 : +0-04
Treasuries
10 YR
2.8986 : -0.0294
Pricing as of 6/21/18 5:30PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
9:02AM  :  Bonds Rally on Weaker Philly Fed Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Sung Kim  :  "furthermore, FNMA will ALSO allow the use of a credit supplement so get the creditor and student on the phone to estimate what the IBR payment WILL be"
Sung Kim  :  "check out the amortizing payment section. subtantially less than 1%"
Sung Kim  :  "If a student loan is in deferment or forbearance, can the payment amount be excluded for qualifying? No, payments in deferment or forbearance may not be excluded for qualifying. If the student loan is in deferment or forbearance and the credit report payment amount is missing (or $0), lenders must calculate a qualifying payment by either using 1% of the outstanding student loan balance or a fully amortizing payment using the documented loan repayment terms. For details on the various repayment options for federal student loans, including definitions of deferment and forbearance, see https://studentaid.ed.gov/sa/repay-loans."
Sung Kim  :  "but let me dig it up to show how incorrect the 1% rule is"
Sung Kim  :  "they show you all the different ways you can figure out the paymnet, not the lazy 1% way"

Economic Calendar
Time Event Period Actual Forecast Prior
Thursday, Jun 21
8:30 Philly Fed Business Index * Jun 19.9 29.0 34.4