Holidays Came and Went Without any Bond Market Fanfare
Fri, Jan 3 2025, 5:29 PM
MBS Recap
Holidays Came and Went Without any Bond Market Fanfare
MBS Recap Matthew Graham | 4:45 PM
Holidays Came and Went Without any Bond Market Fanfare
2 weeks ago today, we assumed the bond market would leave the office for the holidays and reassess during the first full week of 2025. For the most part, that's how things went down. 10yr yields could have ended the week anywhere between 4.5 and 4.6 depending on this morning's data. The higher levels got the nod due to slightly stronger ISM reading. The end. Bigger movement was always most likely to be on hold until and unless the early January data makes a strong, unified case for or against the economy. The early January data in question starts to roll in throughout the week, but as always, the biggest ticket is Friday's jobs report.
Sideways to slightly stronger overnight, but giving up some gains early. MBS up 1 tick (.03) and 10yr down 0.2bps at 4.561
10:07 AM
Slightly weaker after ISM data. MBS down 1 tick (.03) and 10yr up 1bp at 4.572
02:25 PM
treading water at weakest levels. MBS down 3 ticks (.09) and 10yr up 2.3bps at 4.587
Lock / Float Considerations
Rates continue muddling along at or near longer-term highs following the December 18th Fed announcement. There haven't been any glorious recoveries since then. If we hope to see one, it would depend on big ticket econ data like the jobs report or CPI (Jan 10th and 15th respectively). Random volatility remains a risk in the New Year holiday week. If we see calendar-driven support, it wouldn't be until Thursday and even then (and to reiterate), bigger victories require bigger data.
