Solid Data-Driven Gains
Thursday was a fairly straightforward session for bonds. Yields fell modestly overnight in response to slightly lower oil prices and then more forcefully after the cooler-than-expected PPI data. Mid-day fuel price volatility caused a slight pull-back, but not enough to undo a reasonably robust rally by the close. If there's a "yeah but," it's that yields remain broadly sideways near long-term highs and were unable to challenge last week's lows.
Econ Data / Events
Core PPI m/m (Jul)
0.2% vs 0.3% f'cast, 0.2% prev
Core PPI y/y (Jul)
4.2% vs 4.2% f'cast, 4.7% prev
Jobless Claims (Aug)/08
209K vs 202K f'cast, 199K prev
PPI m/m (Jul)
-- vs 0.2% f'cast, -0.3% prev
PPI y/y (Jul)
4.7% vs 4.9% f'cast, 5.5% prev
Market Movement Recap
08:36 AM Moderately stronger overnight and no whammies after PPI. MBS up an eighth and 10yr down 3bps at 4.666
12:55 PM Off best levels, but still up 10 ticks (.31) in MBS, and 10yr down 5.3bps at 4.644
03:55 PM flat this afternoon. MBS up 10 ticks (.31) and 10yr down 5.3bps at 4.643
Incidental Weakness. Bigger Considerations on The Horizon
Incidental Weakness. Bigger Considerations on The Horizon
Without any data or compelling market movers, bonds came into the day light on inspiration. Low volume/liquidity left the door open for any determined t…