Okay, the Fed hath spoketh and the result is in. No rate bump at this FOMC round. At present, Treasury yields and mortgage bonds have already priced in 0.25% bump and for a brief stretch even a bit more as yields faltered. Fed comments were little changed from the previous FOMC powwow withFed hath spoketh perhaps the difference in how the labor markets were still progressing although wage gains remain relatively stagnant.

Wall Street initially jumped on the news and held most of the gains but that reaction was anticipated if no rate increase were made. In fact, it’s interesting to note that if the Fed did indeed raise rates earlier than most thought the question would be, “Are they raising rates because they see something we don’t or are they raising rates because the Fed anticipates more gradual growth as Q3 comes to the horizon?”

The Dow took the news well, closing at 17751.39, up 121.12 for the day. That’s two straight days of gains and the S&P climbed above the 2100 mark yet again. However, the economy overall isn’t giving any clear indications of a recovery and in we won’t see any firm Q2 GDP numbers for several weeks. Most are looking to September as the next possible rate increase but the economic reports continue to be a mixed bag. Real estate is still booming, builder confidence is high and new permits are on the uptick. Financing costs are still low and the non-action by the Fed today has many in the mortgage bond and Treasury markets thinking there won’t be two rate increases this year. The Fed will wait to see what the first bump will do. Rate moves by the Fed at subsequent meetings occur when the economic data is evident, and so far it’s nothing of the sort. A little here. A little there.