This is The Inflation Data You Were Hoping For

The Consumer Price Index (CPI) is the most important economic report for the bond market these days. The most important line item in that report is month over month core CPI, which excludes food and energy. That number was forecast to hit 0.2% but instead came in at 0.1, rounded up from 0.065. That means if this report were repeated for 12 months, core inflation would be under 0.8% for the year. Considering the Fed's inflation target it 2%, it's no surprise that bonds are rallying in response, even though official year over year core inflation is still over 3%. To make matters better, the most problematic component of the core CPI numbers--the one that tracks housing expenses--finally made the big downward shift that analysts have been waiting for. "Shelter" dropped to an unrounded 0.17% from 0.4% last month. That's actually lower than most of the PRE-Pandemic trend. The bond market response was logical and immediate with 10yr yields down about 10bps at 4.18+. MBS are up more than a quarter point. Fed rate cut expectations also ramped up significantly, roughly matching the drop seen after the last CPI report.

July 11, 2024 Download our Mobile App: Download our Mobile App: MBS Commentary This is The Inflation Data You Were Hoping For The Consumer Price Index (CPI) is the most important economic report for the bond market these days. The most important line item in that report is month over month core CPI, which excludes food and energy. That number was forecast to hit... (read more) Rob Chrisman CFPB Proposed Rule, Correspondent and Wholesale Products; CPI and Employment Driving Rates I have good news and bad news, which do you normally prefer receiving first? Today (7/11) is Slurpee Day at 7-Eleven (good news), where Citigroup executives might want to head to cheer themselves up after the Federal Reserve Board on Wednesday fined ... (read more) Mortgage Rates 30 Yr. Fixed Rate 6.85% -0.14% Rate Change Points Mortgage News Daily 30 Yr. Fixed 6.85% -0.14 0.00 15 Yr. Fixed 6.34% -0.05 0.00 30 Yr. FHA 6.29% -0.18 0.00 30 Yr. Jumbo 7.09% -0.12 0.00 7/6 SOFR ARM 6.80% -0.15 0.00 30 Yr. VA 6.33% -0.16 0.00 Updates Daily - Last Update: 7/11 15 Yr. Fixed Rate 6.34% -0.05% Rate Change Points Freddie Mac 30 Yr. Fixed 6.89% -0.06 0.00 15 Yr. Fixed 6.17% -0.08 0.00 Updates Weekly - Last Update: 7/11 Rate Change Points Mortgage Bankers Assoc. 30 Yr. Fixed 7.00% -0.03 0.60 15 Yr. Fixed 6.63% +0.07 0.61 30 Yr. Jumbo 7.13% +0.02 0.38 Updates Weekly - Last Update: 7/10 MBS / Treasuries UMBS 30YR 6.0 100.94 +0.24 Price / Yield Change MBS UMBS 6.0 100.94 +0.24 UMBS 6.5 102.23 +0.18 GNMA 6.0 100.89 +0.14 GNMA 6.5 101.59 +0.07 Pricing as of: 7/11 5:31PM EST 10 Year US Treasury 4.2067 -0.0794 Price / Yield Change US Treasury 2 YR Treasury 4.512 -0.116 5 YR Treasury 4.140 -0.103 7 YR Treasury 4.155 -0.088 10 YR Treasury 4.207 -0.079 30 YR Treasury 4.415 -0.071 Pricing as of: 7/11 5:31PM EST Latest Video Expecting 2-3 rate cuts by the end of the year: Lazard's Ron Temple The rate cut feels like it's really coming, says Ed Yardeni NEC Director Lael Brainard: Consumer brand companies really need to lower t... People aren't worried about inflation anymore, says Piper Sandler's Michael... Around the Web Marketwatch One part of the housing market is doing brisk business, says analyst who called 2008 housing crash CNBC Here's the inflation breakdown for June 2024 in one chart Calculated Risk Blog Part 1: Current State of the Housing Market; Overview for mid-July 2024 CNBC Inflation falls 0.1% in June from prior month, helping case for lower rates Marketwatch Feds Musalem wants more proof inflation is slowing before backing interest-rate cuts forexlive We're not exiting the period in which rate hikes hurt; we're entering it Marketwatch Lumber prices are at record lows what that means for buyers and homebuilders CNBC Oil prices rise as inflation eases, bolstering market hopes for Fed rate cut later this year Calculated Risk Blog Weekly Initial Unemployment Claims Decrease to 222,000 Calculated Risk Blog Leading Index for Commercial Real Estate Increased 10% in June CNBC Watch Fed Chair Jerome Powell testify live before House financial services panel CNBC Treasury yields hold steady ahead of latest consumer inflation data CNBC Oil prices hold firm as OPEC sees solid demand on stronger economic growth this year

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