Posted To: MBS Commentary

The presidential election happened 2 months ago and since then, bonds really haven't moved other than in response to the Pfizer vaccine news on Nov 9th and stimulus news on Dec 1st. Both of those sell-offs took 10yr yields to similar ceilings. Both were under 1.00%. It's entirely possible (if not probable!) that the key motivation for remaining so sideways during that time is that the Georgia senate run-off elections are still TBD. At stake: the balance of power in the US government. Full control by one political party is something the bond market typically cares very deeply about (as seen in late 2016 when the election precipitated the biggest month of bond market losses since 2003). Later this week (Wed night, at the earliest), markets will finally learn whether or not democrats will…(read more)

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Source: Mortgage News Daily