MBS Update: CPI Comes in Lower. Bonds Aren't Mad

Rodney Tumbleston

Managing Member

Kwest Mortgage Group, LLC

P: (803) 707-9997

www.kwestmortgage.com

1725 St. Matthews Rd, NE
Orangeburg SC 29118

License:

NMLS # 414429

MBS Morning:

MBS Recap:

MBS Alert:

MBS Update:

MBS Huddle:

CPI Comes in Lower. Bonds Aren't Mad

9 Hours, 5 Min ago

Monthly Core CPI
- 0.237 vs 0.3 f'cast, 0.1 prev
Annual Core CPI
- 2.8 vs 2.8 f'cast, 2.8 prev

The market wasn't expecting fireworks from today's CPI and despite a brief, initial reaction, that looks like a fair assessment. Had these numbers arrived without the tariff backdrop. the case for a Fed rate cut would be building, but not so much as to be a no-brainer. After all, monthly CPI needs to be averaging 0.17, and 0.237 is higher than that.

One could also note 6 month annualized CPI at 3.0% is higher than 2.0% to make a strong case against rate cuts.

But back to the bond reaction... 10s were down just over 2bps before the data and are down 2.6bps now at 4.445. MBS are up an eighth of a point. Stocks rallied back to yesterday's highs on the news, but have paused there for the moment.

More MBS and Treasury Markets

MBS Recap:

Bonds End Almost Perfectly Flat - Today, 9:07 PM

MBS Alert:

Just a Bit Weaker and a Bit More Reprice Risk - Today, 6:20 PM

MBS Morning:

Stock Gains Creating Bond Pain After Flat Response to CPI - Today, 2:49 PM

MBS Alert:

MBS Down Just Over an Eighth From Highs - Today, 2:09 PM

MBS Recap:

Is All News Bad News For Bonds? Will CPI Matter? - Mon, 9:07 PM

Rodney Tumbleston

Managing Member

Kwest Mortgage Group, LLC

P: (803) 707-9997

www.kwestmortgage.com

1725 St. Matthews Rd, NE
Orangeburg SC 29118

License:

NMLS # 414429

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