Luxury Real Estate Professional
Gina Mancuso Luxury Real Estate
License:
02146794

Powell Press Conference Trumps The Dots, Sparking Moderate Sell-Off

Powell Press Conference Trumps The Dots, Sparking Moderate Sell-Off

Of today's Fed events (rate announcement, dot plot, and press conference), it was the dots that were most likely to cause the biggest reaction. That proved to be the case, but only for the 30 minutes leading up to Powell's presser.  Bonds had already begun pushing back against the rally by the time Powell started fielding questions.  Several of his responses added fuel to the fire. In not so many words, Powell said the dots don't mean the Fed is cutting twice more in 2024 and that the Fed will instead be taking things meeting by meeting as they digest incoming econ data. While that's very standard for the Fed playbook, it didn't convey the level of concern for the economy (bullish for rates) that the market was priced for.  The reversal seems extreme in the short term due to the dot-driven rally, but yields closed no higher than they did last Tuesday--2 days after the jobs report rally that took rates to their lowest levels since October. 

Market Movement Recap
09:48 AM

Modestly stronger overnight and little-changed so far this morning.  MBS up 1 tick (.03) and 10yr down half a bp at 4.027

11:34 AM

Just barely weaker now.  MBS down 1 tick (.03) and 10yr up less than half a bp at 4.035

02:06 PM

Stronger after the dot plot.  MBS up just over an eighth and 10yr down 3.3bps at 3.998

02:40 PM

MBS now down 2 ticks (.06) on the day. 10yr yields are up 2.3bps at 4.053

02:56 PM

MBS now down a quarter point on the day and 10yr up 5bps at 4.08

Latest Video Analysis

Fed Day Selling Spree as Press Conference Trumps The Dots

MBS & Treasury Markets
UMBS 5.0 99.77 +0.19 10YR 4.050% -0.031% 9/18/2025 3:28AM EST
MBS are now down almost 3/8ths of a point on the day and easily over a quarter point from morning rate sheet print times. As such, any lender who has yet to reprice for the worse is highly likely to be considering it.  10yr yields are up 5.3bps at 4.084.  There is no new justification for this late day weakness in terms of headlines or data.    READ MORE
Today's Mortgage Rates
30YR Fixed 6.22% +0.09% 15YR Fixed 5.75% +0.04% 9/17/2025
Several things happen on Fed Day--especially on the 4 out of 8 examples with updated rate forecasts from Fed members.  The official announcement of a rate cut is typically the least important aspect.  In fact, it is usually entirely unimportant in terms of its impact on mortgage rates . Instead, the bonds that determine mortgage rates are much more likely to react to the Fed's dot plot (the chart showing each Fed member's rate forecast over the next few years) an...   READ MORE
Economic Calendar
Time Event Period Actual Forecast Prior
Thursday, Sep 18
8:30AM Sep/06 Continued Claims (k) Sep/06 1950K 1939K
8:30AM Sep/13 Jobless Claims (k) Sep/13 240K 263K
8:30AM Sep Philly Fed Business Index Sep 2.3 -0.3
8:30AM Sep Philly Fed Prices Paid Sep 66.80
10:00AM Aug CB Leading Index MoM (%) Aug -0.2% -0.1%
1:00PM 10-yr Note Auction (bl) 19
Friday, Sep 19
12:00AM Roll Date - Ginnie Mae 30YR
Read My Latest Newsletter
Markets have settled into a cycle that favors the jobs report as the only critical economic data as far as rates are concerned. This week's inflation data had a chance to claim/preserve a role as a strong supporting actor, but instead, it basically stood aside and left focus on the labor market and the Fed's interpretation of recent labor market weakness. A majority of the notion of "recent lab... READ MORE
Luxury Real Estate Professional
Gina Mancuso Luxury Real Estate
License:
02146794