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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Terry Whitman who wrote (11200)	4/16/1999 12:26:00 AM
From: John Pitera	Respond to of 99985

TW, I would say that the yield curve is steepening a bit which is usually a healthy development for the market, as a flat or inverted yield curve occurs at the start of a recession (overheated exonomy), or when the Central bank must fight off a currency attack. ~~~~~ From today's Briefing.com 11:10 ET: 30-year: -7/32...5.527%.....GNMA 6s Dec: -4/32...97-15 The 10/30 spread continues to narrow, moving in to 36.9 bp in recent trading from 37.9 bp yesterday, and 41.5 bp last Friday. What is interesting is that while sources have told us to be on the lookout for a more pronounced narrowing in the spread given seasonal flattening tendencies, the best movement has come in recent days as the curve has undergone a modest steepening trend. While corporate supply and movement into mortgages continues to hamper the 10-year note, some resistance to a more substantial narrowing has come from the 10s special status in the financing market. notice that they call the steepening of the curve modest and their is no ominous tone to this missive.