Latest CPI beats expectations, but inflation remains elevated.

Happy Friday from Local Mortgage!

Travis is on vacation this week, just like our politicians. Information and economic data are very limited during the shutdown, and even though we did get a CPI report this morning, there was very little movement in the mortgage markets this week. We will end the week virtually unchanged from last Friday, still at 5.875% for our best 30 year fixed conventional scenario.

This morning’s Consumer Price Index was widely anticipated all week, especially since it was the only real piece of economic data released for the week. CPI, which is one of the most widely watched inflation indicators, was fairly friendly for bonds, coming in at a 0.2% increase vs. a consensus forecast of 0.3%. Much of the report seems to show that inflation is improving, but it is still at much higher than desired levels.

With the continued shutdown, all eyes will be on Wednesday’s FED meeting. Investors are expecting another 0.25% cut next week. We will see how long-term mortgage markets react this time.

Hope everyone has a great weekend and thank you for reading.