MBS Week Ahead: How Will Paris Tragedy Affect Bond Markets This Week?

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Posted To: MBS Commentary

There are several past examples of global tragedies affecting domestic interest rates. It's not uncommon to see far less grotesque events than those that transpired last Friday have at least somewhat of an impact. So it's a fair question to ask: how will Paris affect rates? Here's the best answer: who cares? These are two very separate spheres of existence, and I'm personally not interested in confusing them. One is an unabashed tragedy. The other is a relatively random walk that doesn't care nearly as much about this sort of tragedy as some might assume. Bond markets will do whatever it is they would have done before the Paris tragedy. Any flight-to-safety improvement seen in rates will either be short-lived, or we can conclude that gains were in our future regardless of...(read more)

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Source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/532091.aspx

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