Good Tuesday AM,

Nope, we have not found bottom yet. Mortgage bonds are struggling to make a comeback from down 22bps at the open to now just down 8bps. The 10-yr pushed back to 1.96%. It feels like we are destined to hit 2% on the 10-yr. All it will take is a strong CPI number on Thursday. There is no reason for this morning’s pressure, the selling is technical. The recent moves, kicked off of course by central-bank hawkishness and strong economic data last week, has seen the global stockpile of negative-yielding debt plunge to the lowest level since 2015. Traders now see a 40% chance of a 50 basis point hike from the Federal Reserve in March. Goldman Sachs Group Inc. strategists say that the hawkish turn from the European Central Bank will benefit stocks in the region as higher rates mean investors should stay overweight attractively valued stocks. Best strategy is to lock now and float down on any improvement.

Please remain safe and healthy.