Bonds made some gains today, much to the relief of anyone who didn't really care to see rates explode higher after hitting long-term lows last week.  Such people are not unreasonable--i.e. they don't expect rates to only ever go lower.  Rather, when rates find themselves needing to go higher, it's preferable if they can manage such things in an orderly fashion.  Yesterday was anything but orderly...

Today was extraordinarily calm by comparison.  Volumes were the lowest in weeks and the trading range was as narrow as it's been since before the March Fed Announcement.  Bond traders were buyers right from the start of the overnight session, and with no particular motivation apart from the brutality of yesterday's weakness.  This is a really good sign, all things being equal as it doesn't suggest an utter unwillingness on the part of traders to step in front of what looked to be a fairly determined selling spree.  That's especially good when yesterday's selling spree was clearly fueled by stronger economic fundamentals (in part, anyway).

But don't call it a comeback.  Today's gains merely restore some balance to the current week's narrative.  It's still bad for bonds in the bigger picture, but just slightly less bad than yesterday.  It continues to be the case that the rest of the week's economic data has the best chance to set the tone from here on out.  Tomorrow's most important reports are ADP employment at 8:15am and ISM Non-Manufacturing at 10am ET.


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
101-02 : +0-04
Treasuries
10 YR
2.4720 : -0.0250
Pricing as of 4/2/19 5:07PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
9:18AM  :  Bonds Stronger Overnight, But Challenges Remain

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "otherwise would have expected to see something in stocks. In other words, it looks bond specific"
Matthew Graham  :  "looks like some fast money trading fired up. There were some Trump/Nato headlines at 1:56pm, but I'm not confident they had any bearing"
Oliver Orlicki  :  "What happened at 2?"

Economic Calendar
Time Event Period Actual Forecast Prior
Tuesday, Apr 02
8:30 Durable goods (%)* Feb -1.6 -1.8 0.3
8:30 Nondefense ex-air (%)* Feb -0.1 0.0 0.8
9:45 ISM-New York index * Mar 869.1 860.7
Wednesday, Apr 03
7:00 MBA Purchase Index w/e 267.5
7:00 Mortgage Refinance Index w/e 1289.5
8:15 ADP National Employment (k)* Mar 170 183
10:00 ISM N-Mfg PMI * Mar 58.0 59.7
10:00 ISM N-Mfg Bus Act * Mar 61.5 64.7