Posted To: MBS Commentary
In the constantly-evolving modern era of market-watching, it’s rare to see simply, old-school “cause and effect” relationship between data and market movement play out, but today was textbook . Bonds were flat throughout the overnight session, clearly waiting for the 8:30am NFP data. The data had no glaring weak points, thus leaving the focus on the big 255k vs 180k ‘beat.’ Normally, we’d be able to say something about the revisions detracting from the beat or a decrease in wage growth, but no such luck today. Bonds sold-off quickly with 10yr yields immediately seeking out the 1.54 pivot point (yields had orbited 1.54 on Tuesday and Wednesday, and had spent half of July trading it as the floor in a very narrow range). This “once floor” didn’t prove to…(read more )