Posted To: MBS Commentary
At the afternoon just passed, bonds continued to rally more details about trade warfare drama unfolded. Late Monday actually, those details unfolded and were simply traded. Notably absent in the rally was that the MBS market (for the most part). Expect it to continue if ancient trading is any sign. But expect it for a sword that is glamorous. To put it differently, if Treasuries promote off, less should be sold off by MBS. The Treasury auction cycle hits its stride with 10yr Notes in 1pm although there aren’t any significant economic reports on tap. Yesterday's 3yr auction has been weak and dealers took it to purchase longer-term Treasuries. If now 's longer-term (10yr, in this instance ) auction is average or better, we should see some additional buying.