I wouldn't go so far as to say this week of bond market movement went "out like a lamb," but at the very least, it wasn't nearly as brutal as the first 4 days.  Yields were almost perfectly unchanged in the overnight session, but began to fall in the morning hours after Trump talked tough on China and called for a 1.0% rate cut from the Fed.

Bonds didn't get too carried away and instead began to consolidate heading into the PM hours.  Sleeping dogs (or were they lions?) were not left to lie, however, as Trump clarified earlier comments on the US "not doing business with Huawei" only pertained to Federal departments and not the nation as a whole.  This was taken as a positive trade war anecdote and thus benefited stocks and hurt bond yields noticeably.

With that, moderate gains turned into moderate losses.  The impressive/notable word in the previous sentence is "moderate."  Today was by far the quietest of the week in terms of volume and volatility.  Maybe things will start to calm down around current levels?  Too soon to tell, but mortgage lenders would like that.  They were able to improve pricing today by more than MBS suggested thanks to the decreased volatility.  There could be a bit more where that came from in the event things continue to consolidate.


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 3.0
101-16 : -0-05
Treasuries
10 YR
1.7460 : +0.0310
Pricing as of 8/9/19 4:52PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:33PM  :  ALERT ISSUED: Negative Reprices Becoming More Likely
12:57PM  :  ALERT ISSUED: Negative Reprice Risk Increasing as Bonds Surge to Weakest Levels
9:06AM  :  Slightly Stronger After Weak Producer Price Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "data matters. twitter matters inasmuch as things we learn on twitter carry future implications for data matter. CPI, Philly Fed, Retail Sales would be the upper tier candidates. All could be trumped by Trump tariff tweets, of course, just as the Fed and ISM data befell the same fate last week."
Arman G.  :  "MG...maybe not relevant in today's bond market but do you think next week's economic reports will play any role? or is twitter more relevant nowadays?? lol"

Economic Calendar
Time Event Period Actual Forecast Prior
Friday, Aug 09
8:30 Core Producer Prices YY (%)* Jul +2.1 2.4 2.3
8:30 Producer Prices (%) Jul +0.2 0.2 0.1
8:30 Core Producer Prices MM (%)* Jul -0.1 0.2 0.3