MBS RECAP: Bonds Unwind Yesterday's Abrupt Losses With Help From Europe

Posted To: MBS Commentary

There have been two back-to-back "unwind" trades in bond markets. The stage was set by Monday morning's rally which was in response to an absence of updates on the healthcare bill over the weekend. Essentially, markets were expressing their disapproval of Washington's ability to get things done. Then on Tuesday, Washington put out a few newswires and Speaker Ryan spoke at a press conference for a few minutes that suggested the House might be able to get things done after all. Markets responded by fully unwinding the positive bond market momentum seen on Monday. Today brought the second "unwind" trade. This time, the US government wasn't involved. In fact, the US wasn't involved at all. Instead, European bond markets led the way. Two factors were in play….(read more)

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Source: Mortgage News Daily

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