Q4, 2020 was all about yields moving higher at a gradual pace.  Same story for Q1, 2021, but at a much quicker pace.  If Q2, 2021 has a them, it's been the consolidation of the past 2 quarters of weakness.  So far, this consolidation pattern has been perfectly flat with the only potential exception being the first hour of trade following the most recent NFP number.  In fact, it's flatter than flat.  That's not casual hyperbole, but rather, a reference to the lower highs and higher lows converging on the same central point of gravity (1.62% in this case). 

20210517 open1.png

The week ahead consists primarily of housing-related data with Friday's Existing Home Sales release arguably standing as the headliner (followed closely by new construction numbers on Tuesday).  In the absence of higher-consequence data, this will offer a good opportunity for the bond market to either double down on the sideways theme or give us a hint about a new move.

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
UMBS 2.5
103-14 : -0-01
10 YR
1.6400 : +0.0050
Pricing as of 5/17/21 9:24AMEST

Tomorrow's Economic Calendar
Time Event Period Forecast Prior
Monday, May 17
8:30 NY Fed Manufacturing May 23.90 26.30
10:00 NAHB housing market indx May 83 83
Tuesday, May 18
8:30 House starts mm: change (%) Apr 19.4
8:30 Build permits: change mm (%) Apr 2.3
8:30 Housing starts number mm (ml) Apr 1.710 1.739
8:30 Building permits: number (ml) Apr 1.770 1.759
Wednesday, May 19
7:00 MBA Purchase Index w/e 276.7
7:00 MBA Refi Index w/e 3281.0
Thursday, May 20
8:30 Philly Fed Business Index * May 43.0 50.2
8:30 Jobless Claims (k) w/e 450 473
8:30 Continued Claims (ml) w/e 3.640 3.655
10:00 Leading index chg mm (%) Apr 1.4 1.3
Friday, May 21
9:45 PMI-Composite (source:Markit) * May 63.5
10:00 Exist. home sales % chg (%)* Apr 2.0 -3.7
10:00 Existing home sales (ml)* Apr 6.09 6.01