The Fed made a few token changes to its policy statement today, but as expected, no overtures for an impending rate hike.  At least that wasn't the case superficially.  If you want to get a bit philosophical with the Fed verbiage, there was an interesting change that might or might not mean something to you.

The change in question has to do with the Fed's forward guidance on hiking rates as follows (new words in all caps):

"The Committee anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen SOME further improvement in the labor market"

While this could be an inconsequential and random insertion, the fact is the only word added or removed to the entire statement outside the first paragraph would seem to suggest it has a purpose.  I think the only question is whether someone reading today's statement was already in tune with the Fed's recent rhetoric or not. 

Simply put, this is very likely the Fed's way of reminding us that we're not far from the first rate hike, be that September or December.  Adding the word "some" seems like an attempt at metering and quantifying how much labor market improvement is needed to motivate a rate hike.  If it didn't move markets too much, it was/is because markets already hear the Fed loud and clear on that stance. 

Ultimately, today's post-FOMC trading completely disappears in even the shortest-term trends.

2015-7-29 bonds vs stocks


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
99-32 : -0-07
FNMA 3.5
103-09 : -0-05
FNMA 4.0
106-00 : -0-03
Treasuries
2 YR
0.7080 : +0.0380
10 YR
2.2900 : +0.0400
30 YR
3.0010 : +0.0380
Pricing as of 7/29/15 6:22PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:28PM  :  Notable Changes in FOMC Statement
2:07PM  :  ALERT ISSUED: First Move Following Fed is Positive, or it WAS, anyway.
10:34AM  :  ALERT ISSUED: On The Edge of Negative Reprice Risk For Some Lenders
10:03AM  :  Modestly Weaker Overnight; Still Waiting Fed

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "RTRS- FED VOTE IN FAVOR OF POLICY WAS UNANIMOUS"
Matthew Graham  :  "RTRS- FED REPEATS RISKS TO ECONOMY AND LABOR MARKET REMAIN NEARLY BALANCED"
Matthew Graham  :  "RTRS - FED SAYS UNDERUTILIZATION OF LABOR RESOURCES HAS DIMINISHED SINCE EARLY THIS YEAR"
Matthew Graham  :  "RTRS- FED REPEATS INFLATION CONTINUES TO RUN BELOW OBJECTIVE, PARTLY REFLECTING EARLIER DECLINES IN ENERGY PRICES AND PRICES OF NON-ENERGY IMPORTS"
Matthew Graham  :  "RTRS- FED SAYS IT WILL RAISE INTEREST RATES WHEN IT HAS SEEN SOME FURTHER IMPROVEMENT IN LABOR MARKET AND IS "REASONABLY CONFIDENT" INFLATION WILL MOVE BACK TO ITS 2 PCT TARGET"
Matthew Graham  :  "RTRS- FED SAYS U.S. ECONOMIC ACTIVITY EXPANDING MODERATELY, WITH SOLID JOB GAINS AND DECLINING UNEMPLOYMENT"
Matthew Graham  :  "A- outright, "B" in the context of this morning's weakness. "
Matthew Graham  :  "RTRS- U.S. SELLS $35 BLN 5-YEAR NOTES AT HIGH YIELD 1.625 PCT, AWARDS 2.98 PCT OF BIDS AT HIGH"