Mortgage Rate Alert to LOCK! 9/20/2017

MBS are down -3/32 (FNMA 30-yr 3.5 at 103.02), around 6/32 below morning levels, and near the low for the day. Unfavorable repricing took place. Investors responded to a Fed statement viewed as hawkish (see below) by selling MBS this afternoon. The Dow is up 40 points. Tomorrow, Jobless Claims and Philly Fed will be released at 8:30 et.

As widely expected, the Fed announced that it will begin in October to reduce the quantity of Treasury and mortgage securities on its balance sheet. Of much greater interest to investors, the outlook for the pace of future rate hikes was a little faster than expected. Roughly 75% of Fed officials forecast one more rate hike this year and three rate hikes in 2018.