China and Japan’s appetite for mortgage-backed securities is likely to continue being a significant factor in 2006, according to a new market outlook by Credit Suisse First Boston. “While Treasuries had been the preferred asset for China and Japan, 2004 was a turning point during which allocations into agency (debt and MBS) scaled up,” CSFB said. “A continuation of this allocation into MBS is likely to continue to make Treasury-based spreads the driving metric of…