**Slight Drift Weakens, Overall Uneventful Market Movement**
The bond market experienced a slightly weaker drift on Friday, with overall market movement being broadly uneventful. It felt like a 4th weekend day as volume and liquidity were clearly in holiday mode. Trading levels remained mostly flat throughout the day, although some might have noticed MBS prices ending the day down more than an eighth of a point.
It’s uncertain whether this slight weakness at the end of the day was a true reflection of market conditions or simply a result of extremely thin liquidity. Regardless, the day’s movement wasn’t all bad, especially when compared to where things stood on Tuesday afternoon. The market saw some stronger overnight activity but ultimately gave up those gains in the past hour, leaving MBS unchanged and the 10-year down half a basis point at 4.609.
As the day progressed, the market remained sideways at the lows, with MBS down 1 tick (.03) and the 10-year down half a basis point at 4.608 by early afternoon. However, by the time trading closed, we saw the weakest levels of the day, with MBS down an eighth of a point and the 10-year up 0.4 basis points at 4.617.
**Building Permits and Housing Starts**
In other market news, Building Permits came in at 1.483 million, slightly higher than the forecasted 1.460 million. Housing Starts also exceeded expectations, reaching 1.499 million compared to the projected 1.320 million.
Overall, Friday’s market movement may have been uneventful, but the slight drift and fluctuating levels provided some interesting insights into the current state of the bond market. While some may have been hoping for more significant changes, the day’s activities serve as a reminder of the importance of closely monitoring market conditions and staying informed about key economic indicators.
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