MBS RECAP: Bonds Improve After Treasury Auction; Why MBS Are Lagging

Bonds Improve After Treasury Auction; Why MBS Are Lagging Bonds began the day weaker, but improved steadily after the 10yr Treasury auction. MBS underperformed--partly because the Treasury auction brings more direct benefit for Treasuries, but for a few other reasons as well. We'll discuss those (and whether or not they're important) in today's recap video. Econ Data / Events Fed MBS Buying 10am, 1130am, 1pm 10yr auction grade: A Market Movement Recap 08:26 AM Bonds are unchanged despite weakness in EU bond market. Yields were as high as 1.631 (now 1.608). MBS are 1 tick weaker (0.03) at 102.59 (2.5 coupons). 11:44 AM Slightly weaker into the 9am hour, then stronger after the 9:30am NYSE open. Levels are back in line with the first update (i.e. close to unchanged). 01:06 PM More...(read more)

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