Bonds Find Some Solace in Warsh Despite a Bit More Selling

The past 2 days have been rough for the bond market--nothing catastrophic, but "brisk" in terms of unexpected selling pressure.  To be fair, buying/selling pressure is never truly expected (otherwise, why wait to trade it?), and higher volatility was definitely a risk surrounding quarter-end and the data calendar. Today could have been worse, but the market found some solace in this morning's Warsh comments the ECB SINTRA conference. Warsh stuck to the "no forward guidance" script but managed to offer some in a roundabout way by saying inflation risks have come down and that he was open to different views on the Fed's balance sheet size. While not true forward guidance, it was a net-dovish message that the market reacted to. Shorter-term debt did best, but 10yr yields are ending up about 2bps lower than they were before Warsh.