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Bonds drift lower as fuel prices lift yields at the short end

MBS were down about an eighth of a point, while the 10-year yield rose to 4.586 as 2-year yields led the selloff.

Reported · Written up by our desk · Government Bonds

U.S. Treasury markets slipped modestly, with Mortgage-Backed Securities falling by roughly an eighth of a point and the 10-year yield rising slightly, according to Mortgage News Daily.

The weakness was concentrated in the front end of the curve, where 2-year yields rose about 1.5 basis points, while yields on the longer end were comparatively steadier.

Mortgage News Daily pointed to a lack of a clear economic catalyst and cited an ongoing surge in fuel prices, noting that fuel futures peaked as bond yields did and then both declined together afterward.

Overall, the outlet described the move as incidental consolidation following a solid two-day rally, with the 10-year yield up 3.5 basis points to 4.586 and no reaction tied to incoming economic data.

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