Monday may not have been an official holiday for the U.S. bond market, but it way as well have been. Volume certainly acted the part, which is no surprise considering overseas holiday closures. Headlines and data had a limited impact, at best. In general the market is waiting to see what happens in Iran after tomorrow night's deadline on Trump's ultimatum to reopen shipping channels.
A hair weaker overnight but rallying into positive territory in early trading. MBS up 6 ticks (.19) and 10yr down 1bp at 4.332
01:05 PM
MBS up 6 ticks (.19) and 10yr down 0.7bps at 4.334
03:05 PM
MBS up 6 ticks (.19) and 10yr down 1bp at 4.331
Lock / Float Considerations
4/6/26 (unchanged from Friday) - March's rate spike has come off the boil as of early April, but volatility risks remain as long as the war in Iran continues. Volatility risks exist for other reasons as well, of course, but what we're waiting for is the potential shift in defensive momentum that could coincide with the end of the war. While the past several days have been "nice" in that regard, it's still too soon to bank on it from a lock/float standpoint.
