Strong Data Redefining The Rate Outlook
The market was faced with two compelling "yeah buts" to what has generally been a symphony of economic bearishness over the past few weeks. After today, there's little if any rate cut probability priced into 2023's outlook, but until it does, it's rough sledding for rates. MBS now down "only" 3/4ths of a point and 10yr yields up only 13.5bps at 2.83% (previously as high as 2.87%. The market is not making much of a dent yet.