Morning Alert from MBS Live:

Volatile Overnight Session. Bond Markets Open Slightly Stronger 8:19AM

It was an uncommonly choppy overnight session as bond markets spent yet another night tuned in to all things European. US 10year yields fell near yesterday's lows on weak data and ongoing concerns about what seems like a growing laundry list of countries (added Finland last night?), then rose sharply near yesterday's highs on news of ECB buying, only to fall again on more of the "concern thing" as well as diminished ECB buying. Is it really that simple and linear? We don't know... Probably not... But was it really that choppy? Yes... 

Whatever the case, 10yr yields are opening down a bp or so at 2.038 and MBS's first ticks are in line with yesterday's low (Fannie 3.5's at 101-19). There's enough by way of economic data on tap this morning for our domestic events to actually move markets! Here's the run-down:

MBA Applications at 7am (already out. Refi index down over 12% purchase index down over 2%). 

Consumer Price Index - 830am. This metric of inflation at the consumer level is expected to have fallen from +0.3 pct last month to 0.0 pct this month. Excluding the more volatile food and energy components, consumer-level inflation is seen flat at +0.1 pct. 

Treasury International Capital - 9am, which shows the level of foreign investment in US Treasuries 

Industrial Production/Capacity Utilization - 915am. Industrial Production is expected to have risen to +0.4 pct versus last month's +0.2 pct and capacity utilization to be slightly higher from a previous reading of 77.4 pct to a current reading of 77.6 pct 

NAHB Housing Market Index - 10am - Seen flat at an index value of 18.0. 

Fed Speak from Rosengren

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Apart from that, there are the joys of dissecting and interpretting the joint releases of HARP 2.0 guidelines from Fannie and Freddie late yesterday afternoon.  We'll bring you more on that soon.  Here are price/yield levels and charts from MBS Live this AM: