Rates surge to 6-week high on Hormuz blockade fears, hawkish Fed read

Mortgage rates jumped to their highest level since March 30 today, driven primarily by reports that the U.S. is considering a prolonged blockade of the Strait of Hormuz. Bond markets moved sharply overnight on the news, and selling accelerated through the morning as a White House official corroborated the reports. The Federal Reserve held its benchmark rate steady at 3.50–3.75%, as expected — but three dissenting voters opposed language in the statement that implied future rate cuts, marking the most divided Fed vote since 1992. The Fed's tone added modest pressure on top of the geopolitical selling. UMBS 5.0 closed down 0.58 at 98.34; the 10-year Treasury finished at 4.427%, up 8.1 basis points on the day.