An increase in the federal funds rate, and the likelihood of further increases, was followed by a surge in stock and bond prices. The increase was already built into mortgage rates.

On Wednesday, the Federal Reserve Board announced that its Federal Open Market Committee decided to raise its benchmark short-term rate 25 basis points.

In addition, the Fed indicated that expected economic conditions could warrant two more quarter-percentage-point rate increases this year and three next years.

Source: Mortgage Daily