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NFP beat lifts yields modestly as MBS slide less than expected

After the jobs report, mortgage-backed securities fell 6 ticks, while the 10-year Treasury yield rose 2.6 basis points to 4.796%.

Reported · Written up by our desk · Economy

Mortgage News Daily said the market reaction to the nonfarm payrolls beat was surprisingly muted for bonds, with the labor-market details not translating into the kind of sharp rate move many investors expected.

The outlet pointed to shifting labor force trends and ongoing seasonal distortions, arguing that job counts are a less precise gauge of labor market health than in past cycles, while the unemployment rate has been steadier and less prone to large swings around major releases.

Mortgage-backed securities were down 6 ticks, while the 10-year Treasury yield was up 2.6 basis points to 4.796% early in the day, after trading was first driven by the 3-day weekend factor and anticipation of next week’s inflation data.

Mortgage News Daily added that while NFP still matters, the report did not hit the bond market as hard as implied by its headline surprise.

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