- FED SAYS TO CUT TARGET FEDERAL FUNDS RATE BY 50 BASIS POINTS TO RANGE OF 1.00 PCT TO 1.25 PCT
- FED SAYS FUNDAMENTALS REMAIN STRONG BUT CORONAVIRUS POSES EVOLVING RISKS TO ECONOMIC ACTIVITY
- FED SAYS FOMC IS CLOSELY MONITORING DEVELOPMENTS AND WILL USE ITS TOOLS AND 'ACT AS APPROPRIATE TO SUPPORT THE ECONOMY'
- FED SAYS VOTE TO LOWER FED FUNDS RATE WAS UNANIMOUS
It was rumored, then expected, and now it's here (arguably a bit earlier than most market participants expected).
10yr yields are slightly HIGHER so far, which might seem paradoxical at first, but consider the Fed is throwing a bone to the overall financial market and to the shorter end of the yield curve. 10yr Treasuries have benefited from panic, uncertainty, and economic concerns. If a Fed rate cut helps ease those things, it's bad for longer-term rates.
MBS haven't reacted much yet, but it could be coming. If you have a jumpy lender, negative reprices are a risk. If you're lender is less jumpy, watch the price feed like a hawk and wait for further alerts.