July 14th, 2026 9:32 AM by Richard Sardella MLO.100007700/NMLS 233568
This morning the June CPI (consumer price index) was reported substantially lower than forecasts, temporarily taking inflation down a notch. The report the most off the mark we have seen in months. The Fed likes the PCE (personal consumption expenditures) but the report today rocks the inflation worries, at least for now. The easing of prices came from a big decline in energy and an easing in services costs, particularly for housing. The decline, the most in six years with oil prices decline, the energy component fell 5.7%, the largest decline since April 2020.
Kevin Warsh is testifying to the House Financial Services Committee his morning, a comment from his prepared text, “The Fed’s number one objective is to get monetary policy right — or as near to it as we possibly can.” Warsh said in remarks to Congress set for delivery Tuesday. “That is our clear and constant aim, the star we steer by. And if we get policy right — and we will — the inflation surge of the last five years will be a thing of the past.”
In other news this morning, June NFIB small business optimism index thought to be at 95.6 from 95.3 increased to 97.4.
Warsh still testifying, no other scheduled data today. The Iran issues very much alive, any increase in hostilities will over-ride this morning’s inflation report. The CPI drop is primarily driven by the decline in energy prices and may be a one off positive as oil prices have increased in July.
PRICES @ 10:00 AM
10 year note: 4.57% -5 bp
5 year note: 4.31% -7 bp
2 year note: 4.18% -10 bp
30 year bond: 5.08% -2 bp
30 year FNMA 5.5: @9:30 am 99.73 +26 bp (+7 bp from 9:30 am yesterday)
30 year FNMA 6.0: @9:30 am 101.65 +23 bp (+8 bp from 9:30 am yesterday)
30 year GNMA 5.5: @9:30 am 100.30 +32 bp (+16 bp from 9:30 am yesterday)
Dollar/Yen: 161.93 -0.52 yen
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Dollar Index: 100.69 -0.54
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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.
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MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.