Posted To: MBS Commentary

Yesterday offered up a fairly intense trading session for the bond market. Yields moved to the lowest levels in months with 10yr Treasuries hitting 1.534 in the afternoon. Shortly thereafter, the World Health Organization (WHO) officially declared coronavirus to be an international public health emergency. While that sounds like it might be good for bonds, the reaction was quite the opposite. The WHO's announcement helped stocks and hurt bonds because it paves the way for a more robust international response to the crisis. A more robust response would theoretically decrease the time frame of the epidemic and thus the economic impact. Additionally, the WHO reprimanded countries who have ghosted China in one of several ways (travel, trade, and screening were mentioned). Bond yields bounced…(read more)

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Source: Mortgage News Daily