Rates Holding... All Eyes on the FOMC

With the Fed meeting taking place today, and results due in the next hour and a half, all eyes are focused on what will come of this meeting; to be more specific what type of language will be used. Will the Fed keep the "extended language" or will they opt to use language that suggests policy change in the nearer future.

One thing is for certain no one is expecting the Fed to change policy right now. What they are looking for are the subtle nuances in the language they choose to use in the release, and whether or not there is dissidence among the rankers.

Currently the Mortgage Backed Securities market has shown little movement today, with us up currently one tick, and having closed at the same level for the last four trading days... it's clear everyone is looking for some indicator as to which direction the Mortgage Backed Securities will trend. If you have read any of my previous posts, you know I think there is only one direction the MBS can head, and that is down (remember losses lead to higher interest rates).

The wise move for those of you currently working through financing would be to lock in the rate now while rates are still in the 4s. Anyone that is a gambler understands the importance of odds. Currently the odds of interest rates remaining in the 4s for an length of time is slim. Therefore a wise gambler (if there is such a thing) would take while the taking's good and lock... If you're not a gambler, I don't know why you are floating your rate in open market in the first place. A .25 point reprice for the worse (which is not uncommon) on a 200,000 dollar home loan would cost you 500.00 dollars. Conservative people that do not like risk should already have their rate locked to avoid this.