Bonds Weren’t Gotten ready for Fed’s Inflation Worries

Bonds Weren’t Prepared For Fed’s Inflation Fears

Wed, Mar 18 2026, 5:04 PM

Bonds Weren’t Gotten ready for Fed’s Inflation Worries

If anything, you ‘d think the market would have been pricing in a hawkish Fed day, given the added in energy costs. But Powell threw reporters a captain hook throughout journalism conference and instead positioned the concentrate on other classifications of inflation that were under the microscopic lense before the energy cost spike (like core goods and non-housing services), saying there ‘d been less development than hoped. The takeaway was that rate cuts are on hold for the foreseeable future. The marketplace concurs, as it is now pricing the next rate cut at more than a year in the future. Bonds were already losing ground on oil cost spikes (and PPI to a lower extent). The net impact took yields back near recent highs and hit MBS for almost half a point.

• • Core PPI m/m (Feb)
    • 0.5% vs 0.3% f’cast, 0.8% prev
  • Core PPI y/y (Feb)
    • 3.9% vs 3.7% f’cast, 3.6% prev
  • PPI m/m (Feb)
    • 0.7% vs 0.3% f’cast, 0.5% prev
  • PPI y/y (Feb)
    • 3.4% vs 2.9% f’cast, 2.9% prev

08:32 AM

A little weaker after PPI information. MBS unchanged after being up a few ticks and 10yr up.8 bps at 4.207

09:16 AM

additional weak point with oil prices surging. 10yr up 2.8 bps at 4.227 and MBS down more than an eighth of a point

02:12 PM

modestly stronger after Fed statement. MBS still down 3 ticks (.09) and 10yr up 1.5 bps at 4.214

02:57 PM

MBS are now down 9 ticks (.28) and 10yr up 5.3 bps at 4.253

04:13 PM

Weakest levels. MBS down nearly half a point and 10yr up 6.6 bps at 4.266

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