CHM Blog

December consumer prices (CPI) released at 8:30 am ET this morning. There were no CPI inflation reports for October and November and there will not be, due to the shutdown. Month/month overall inflation increased 0.3% as expected, year/year overall +2.7% with forecasts of +2.6%. The core (ex-food and energy) expected +0.3%, reported +0.2%; year/year +2.6% with estimates at +2.7%. Inflation remains above what the Fed would like at 2.0% but inflation isn’t increasing either. Shelter, a key element, increased 0.4%, which was the biggest item for the monthly increase. The shelter accounts for more than one-third of the CPI weighting and was up 3.2% on an annual basis. Food prices jumped 0.7% for the month. The takeaway is that core inflation, the Fed’s prime focus, clocked in a little lower.

Prior to the 8:30 am release the 10 traded at 4.20% +2 bps from yesterday, there was a little bounce on the report pushing the note to 4.16% although it didn’t hold and scooted back to unchanged at 4.18%: MBS prices at 9 am -3 bps from yesterday’s close.

A month ago ADP announced a revision on how it reports private jobs. According to the release today, private employers added an average of 11,750 jobs per week in the four weeks ending December 20, 2025, up from an average gain of 11,000 in the prior period. This marked the fifth consecutive period of job growth and the strongest pace since late November, with hiring continuing to remain firmly in positive territory, according to ADP Research.

Early this morning NFIB released its small business optimism index for December, expected at 99.4 reported at 99.5 up from 99.0 in November.

At 9:30 am the DJIA opened -20, NASDAQ -9, S&P +1. 10 year 4.17% -1 bp. FNMA 5.0 30 year coupon at 9:30 am +1 bp from yesterday’s close and -20 bps from 9:30 am yesterday.

At 10 am October new home sales thought to be 714K increased to 737K.

At 1 pm Treasury will auction $22B of 30 year bonds; yesterday’s 10 year auction saw decent bidding.

At 2 pm Treasury will release the December budget; estimates are the monthly deficit at -$152.5B down from -$173.3B in November.

PRICES @ 10:00 AM

10 year note: 4.17% -1 bp

5 year note: 3.75% -1 bp

2 year note: 3.54% unch

30 year bond: 4.83% unch

30 year FNMA 5.0: @9:30 am 100.17 +1 bp (-20 bp from 9:30 am yesterday)

30 year FNMA 5.5: @9:30 am 101.37 -2 bp (-15 bp from 9:30 am yesterday)

30 year GNMA 5.0: @9:30 am 100.02 -5 bp (-15 bp from 9:30 am yesterday)

Dollar/Yen: 158.97 +0.80 yen

Dollar/Euro: $1.1661 -$0.0006

Dollar Index: 98.97 +0.11

Gold: $4,622.90 +$8.20

Bitcoin: 92,601 +1192

Crude Oil: $60.60 +$1.10

DJIA: 49,328 -262

NASDAQ: 23,744 +10

S&P 500: 6973 -5

Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.