Bonds sold off today, but not excessively, and almost not at all if MBS had anything to say about it.  Even Treasuries were fairly close to 'unchanged' to start the domestic session and were almost able to regain those levels after a few early hours of weakness.  

Heading into the PM hours, however, Treasuries were locked in a fairly linear and generally gentle trend toward higher yields.  For most of the day (but especially in the AM hours), MBS were more than willing to outperform Treasuries with the latter being only modestly weaker and mostly sideways (fertile ground for MBS outperformance!).  As the selling shifted gears from "almost imperceptible" to something a bit more threatening, MBS stopped trying so hard and joined Treasuries in their slide toward negative territory.

By the end of the day, 10yr yields were up just over 3bps while Fannie 3.0 MBS held losses to 3 ticks (0.09).  Tomorrow brings the start of the Treasury auction cycle and the 2nd tier inflation data (Producer Prices).  These aren't necessarily extreme market movers, but the auction cycle could be one of the culprits driving a general reluctance among bond buyers at the start of the week.


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
101-27 : -0-03
Treasuries
10 YR
1.5650 : +0.0510
Pricing as of 10/7/19 5:50PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
4:22PM  :  ALERT ISSUED: Negative Reprice Risk Increasing
12:43PM  :  ALERT ISSUED: Negative Reprice Risk Increasing For Some Lenders
11:22AM  :  MBS Outperforming Despite Some Pressure

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
John Trayler  :  "The old worsen"

Economic Calendar
Time Event Period Actual Forecast Prior
Tuesday, Oct 08
8:30 Core Producer Prices YY (%)* Sep 2.3 2.3
8:30 Producer Prices (%) Sep 0.1 0.1
13:00 3-Yr Note Auction (bl) 38