Posted To: MBS Commentary
Bond markets weakened overnight as Yen/USD surged higher (meaning Yen is weakening versus the dollar). This has to do with the potential for new stimulus at the end of the month whereby Japan is rumored to be considering giving money directly to its citizens (instead of buying bonds). Today isn’t the first time this moved markets, but a few more headlines were out overnight, so a bit more movement took place. Meanwhile, another major central bank was set to make news a few hours later. Not everyone expected the Bank of England to cut rates at today’s meeting, but evidently more than a few traders were surprised by the fact that they abstained . Rates moved swiftly higher after that and entered the domestic session with 10yr yields up to 1.52 from yesterday’s close of 1.475. The…(read more )