What You See Today Won't Necessarily Be What You See Tomorrow

With essentially nothing on the event calendar to start the new week, it was fair to expect a continuation of the same sideways drift that characterized last week.  It's not the future can ever be predicted when it comes to markets, but we can say the flat trajectory is the least surprising outcome for Monday.  That same trajectory will be increasingly surprising over the next 2 days, with a special focus on Wednesday (CPI day).  Even Tuesday deserves some respect with the Producer Price Index and a moderated discussion from a European banking conference with Fed Chair Powell. Today's Fed-speak wasn't worth any volatility, but the NY Fed's consumer survey showed an uptick in inflation expectations and made for a modest intraday bump at 11am ET. 

Market Movement Recap
10:01 AM

Sideways to slightly stronger overnight. Additional modest gains early.  10yr down 2.8bps at 4.47.  MBS up 5 ticks (.16).

01:14 PM

Small pop toward weaker levels after Fed inflation survey, but back toward better levels now with 10yr down 2.4bps to 4.474.  MBS up 5 ticks (.16).

03:18 PM

Weakest levels of the afternoon.  MBS still up 2 ticks (.06) but down nearly an eighth from the highs.  10yr still down 1.1bps, but at the highs of the day, 4.487.

04:22 PM

Off the weakest levels.  MBS up 3 ticks (.09) and 10yr yield down 1.2bps at 4.486

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