Over the course of the past two weeks, and especially in the past few days, there's been so much focus on today's CPI release that it may have bordered on annoying. A few things are more annoying, however. Today's example is a bond market that was incredibly eager to confirm that CPI deserved every bit of the recent hyper-focus. By the time we consider that the big jobs numbers earlier in the month hit when yields were low enough to offer little argument to correction, today's CPI reaction is larger and more significant by an order of magnitude. The heretofore ceiling at 4.19% in 10yr yields was immediately shattered and we now find ourselves at the weakest levels in 2 months, resigned to wait on other economic data to tell a more rate-friendly story.
moderately stronger overnight with all the gains arriving in Europe. 10yr down 2.7bps at 4.152.
Sharply weaker after CPI. 10yr up 10bps at 4.279. MBS down roughly half a point.
5.5 coupons are currently down 5/8ths on the day. 6.0 coupons (quickly becoming more relevant for pricing) are down only 14 bps (.44). 10yr yields are up 10.4bps at 4.283
New lows with 6.0 coupons down half a point and 10yr yields up 11.4bps at 4.293.
MBS Market Alerts
