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MBS RECAP: Bond Markets Relieved by Fed's Tame Balance Sheet Plans

Posted To: MBS Commentary

Coming into today, we had two key options as far as potential market movers were concerned: economic data and the Fed Minutes. On the data front, ADP Employment led the charge, coming in at 263k vs a 187k forecast. That didn't bode well for bond markets, but some of the damage was mitigated by the downward revision to last month's 298k blast (now revised at 245k). With that, bond markets put in their highest 5 minutes of volume from 8:15-8:20am. That might seem surprising considering expectations for the Fed Minutes, but that's the nature of ADP data. It usually makes for a quick hit volume and volatility that quickly yields to whatever else the day has in store (the FOMC Minutes would later bring in significantly more volume overall). Today, ADP yielded fairly quickly to the 10am…(read more)

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Source: Mortgage News Daily

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