Data-Driven Weakness
Data-Driven Weakness
It was a reasonably straightforward day for the bond market. Trading was flat overnight, then weaker after the 8:30am Jobless Claims data. That report is hit and miss as a market mover, but a sub-200k print without any recent seasonal spike is certainly worth a few bps of weakness. Impacts were most notable in Fed Funds Rate expectations, which have now fully eliminated any possibility for a January cut and lowered the probability of a March cut from over 40% last week to under 20% today. In the bigger picture, longer-term rates remain squarely range-bound and MBS remain broken out the top of their comparable range thanks to GSE purchases.
First move is weaker after lower jobless claims. MBS down an eighth and 10yr up 2.5bps at 4.157
Lows of the day after rebounding into the 9:30am hour. MBS down 6 ticks (.19) and 10yr up 2.6bps at 4.159
MBS down 6 ticks (.19) and 10yr up 2.1bps at 4.153
Weakest levels for Treasuries with 10yr up 3.2bps at 4.164. MBS still down 6 ticks (.19).
Data-Driven Weakness
| Time | Event | Period | Actual | Forecast | Prior |
|---|---|---|---|---|---|
| Thursday, Jan 15 | |||||
| 8:30AM | Nov Import prices mm (%) | Nov | 0.4% | -0.1% | |
| 8:30AM | Jan NY Fed Manufacturing | Jan | 7.70 | 1 | -3.90 |
| 8:30AM | Jan/03 Continued Claims (k) | Jan/03 | 1884K | 1890K | 1914K |
| 8:30AM | Jan/10 Jobless Claims (k) | Jan/10 | 198K | 215K | 208K |
| 8:30AM | Jan Philly Fed Prices Paid | Jan | 46.90 | 43.60 | |
| 8:30AM | Jan Philly Fed Business Index | Jan | 12.6 | -2 | -10.2 |
| 10:00AM | Nov Business Inventories (% ) | Nov | |||
| Friday, Jan 16 | |||||
| 12:00AM | Roll Date - UMBS 15YR, Ginnie Mae 15YR | ||||
| 9:15AM | Dec Industrial Production (%) | Dec | 0.1% | 0.2% | |
| 10:00AM | Jan NAHB housing market indx | Jan | 40 | 39 | |
