Uneventful Start to What May be an Uneventful Week

Without any big ticket events or major news headlines, it was no surprise to see bonds bounce around in a narrower sideways range.  Data-free Mondays are often superfluous when it comes to informing the big picture and today was no exception. It might have been even narrower if not for holiday closures in the overnight session (lower volume and lighter liquidity can increase volatility, all other things being equal).  MBS underperformed Treasuries in a small but obvious way (MBS lost ground while Treasuries improved), but we're not reading much into that just yet.  This week's only hope for inspiration is the Treasury auction cycle--at least in terms of scheduled events--and that means we're probably waiting for May 15th CPI for the next big dose of volatility.

Market Movement Recap
09:53 AM

Slightly stronger at the open, but backtracking in the past hour.  MBS up 1 tick (.03).  10yr down 1.1bps at 4.503.

11:09 AM

Weakest levels of the morning with MBS down 1 tick (.03) and 10yr up only half a bp at 4.509.

02:56 PM

MBS underperforming, still at weakest levels, down 2 ticks (.06).  10yr down 2.3bps at 4.489

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