Today’s PDF had a few bullets showing just how hard it is to be a central banker. Hawks dissents are NOT to be dramatized (so says the dissenting hawks) and globally, we’ve seen the PBoC and ECB now out dove the uber-dovish.
Meanwhile, the week ahead has another chance for the FED to pick a side (uber DOVE or more hawk talk — the pros surveyed by BBG see an MBS taper as soon as 2022).
Meanwhile the Dept of Tsy sells 2s, 5s and 7s. I continue to favor going WITH known flows (supply vs month-end demand — IDEA HERE) and this has ME continuing to think about MBS … $MBB to be specific … support is close but if a large and known buyer of all the supply decides its time to taper off its purchases and some sort of VolMaGeddon commences, it’s anyone’s guess HOW this reverberates THROUGH global macro … Watch $MBB for some clues:
I’ve got some other views (buy dip in bond prices) and will look at $TLT as well as weekly close of 30yy (relative TO 1.90/93) over the weekend.
For now, with the IHS Markit PMI data (FUNduhMENTAL highlight) behind us, it’s time for the pros to deploy The Hamptons Hedge … more, later.