Despite Friday's volatile move into weaker territory, recent bond market trading decisions have been surprisingly logical.  Arguably, we saw Friday afternoon's weakness because Friday morning was much stronger.  In short, markets moved to the skeptical end of the spectrum regarding a Greek deal in the morning, and then simply returned to Thursday's closing levels after the deal ended up coming together in the afternoon.  As I said on Friday morning, Greece 'folding' was priced in.  The longer they went without folding, the stronger bonds got, and when they ultimately folded, bonds snapped back to the 'priced-in' levels.

So why are we rehashing all that?  Simply put, because markets are continuing to trade this Greek bailout extension.  It started looking shakier over the weekend as Germany reminded markets that Greece's list of reforms might not pass muster at the 19 Eurozone governments that must ratify it.  Germany further clarified that failure to ratify this week would result in a significantly longer renegotiation process--one that would quite possibly extend past Greece's solvency.

Just now, Greece gave the world a heads-up that it would be late in getting today's reform list to the Eurogroup.  And once again, bond markets are trading the outlook for a legitimate Greek bailout extension.  Every time it looks more possible, bonds lose.  Every time it's called into question, bonds win.  Right now, they're winning, but cautiously. 


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
101-13 : +0-07
FNMA 3.5
104-12 : +0-04
FNMA 4.0
106-19 : +0-02
Treasuries
2 YR
0.6180 : -0.0243
10 YR
2.0680 : -0.0472
30 YR
2.6700 : -0.0481
Pricing as of 2/23/15 12:57PMEST

Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
9:32AM  :  Bonds Rally as Germany Reminds us Greek Deal is Far from Done

Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Michael Ullmann  :  "the only significance of 10% is the mip will drop at 11 years. You get the .80 rate at less than 95% does not have to be 90%"
joon choi  :  ".80"
Daniel Kramer  :  "on FHA purchase, with more than 10% down payment, on a 30 yr fixed, is the new MI rate .80 or .85?"
Matthew Graham  :  "RTRS - US JAN NATIONAL MEDIAN PRICE FOR EXISTING HOMES $199,600, +6.2 PCT FROM JAN 2014"
Matthew Graham  :  "RTRS- US JAN INVENTORY OF HOMES FOR SALE 1.87 MLN UNITS, 4.7 MONTHS' WORTH"
Matthew Graham  :  "RTRS - US JAN EXISTING HOME SALES 4.82 MLN UNIT RATE (CONSENSUS 4.97 MLN), VS DEC 5.07 MLN (PREV 5.04 MLN)-NAR"
Matthew Graham  :  "'Month-End Buying,' And Its Effect on Bond Markets "
Josh Stika  :  "I understand why that happens at the end of a quarter- why does it happen at months end?"
Victor Burek  :  "would be nice...it is month end which has been good for us"
Josh Stika  :  "What do you say Vic - we're about due for a good week don't you think?"