Posted To: MBS Commentary

Here's one of those NFP mornings where it would have been very hard to predict what we're seeing in bonds based on what we've seen in the NFP numbers. The jobs report itself was solidly stronger than expected, but bonds spent almost no time moving toward higher yields in response. Instead, they're in the middle of a fairly strong rally. What gives? There are several factors in play that can help reconcile the move. 1. Overnight data in Europe was very weak, and bonds rallied in response 2. The prevailing bounce back in Chinese equities stalled out today after a strong showing yesterday. Some suspect the country is confirming new coronavirus cases as fast as their infrastructure will allow, and that's the only reason the pace of diagnosis appears to be leveling off (because…(read more)

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Source: Mortgage News Daily