CHM Blog

Markets waited all week for the April PCE inflation data, at 8:30 am ET the PCE month/month +0.1%, year/year +2.1%; the core month/month +0.1%, year/year +2.5%, all met forecasts. Year/year PCE core lower than in March, month/month slightly higher. April tariffs had yet to show up in consumer prices, the Commerce Department reported Friday.

April personal income month/month expected at +0.3% from +0.5% increased by 0.8%. April spending thought to be +0.2% from +0.7% reported at +0.2%. Consumer spending, slowed sharply for the month, posting just a 0.2% increase, in line with the consensus but slower than the 0.7% rate in March.

Since February PCE inflation has held steady, not increasing. Weekly jobless claims jumped last week, reported yesterday. There isn’t anything in the recent data that would encourage the Fed to lower rates.

Also at 8:30 am ET, April advance US trade deficit was expected at -$143.0B, the deficit at -$87.6B; imports month/month declined -19.8%, exports +3.4%.

Yesterday afternoon just after markets closed at 4 pm a federal appeals court temporarily reinstated the President's tariffs, just one day after a trade court ruled he had overstepped his authority. The President is considering using different authority to impose tariffs for 150 days if the appeal of the court ruling fails, according to The Wall Street Journal.

At 9:30 am the DJIA opened -131, NASDAQ -69, S&P -19, 10 year at 9:30 am 4.43% unchanged. FNMA 6.0 30 year coupon at 9:30 am +3 bps from yesterday’s close and +1 bp from 9:30 am yesterday.

At 9:45 am the Chicago purchasing managers May index thought to be at 45.0 from 44.6, the index continued to decline, reported at 40.5.

At 10 am the final University of Michigan consumer sentiment index estimated at 52.0 from 50.8 two weeks ago. Last Tuesday the May Conference Board consumer confidence data improved much more than forecasts. The report isn’t as optimistic as we saw in the Conference Board’s release.

PRICES @ 10:00 AM

10 year note: 4.41% -2 bp

5 year note: 3.99% -2 bp

2 year note: 3.94% -1 bp

30 year bond: 4.92% unch

30 year FNMA 6.0: @10 am 100.88 +3 bp (+1 bp from 9:30 am yesterday)

30 year FNMA 6.5: @10 am 102.61 +2 bp (+2 bp from 9:30 am yesterday)

30 year GNMA 6.0: @10 am 100.83 unch (-7 bp from 9:30 am yesterday)

Dollar/Yen: 144.12 -0.06 yen

Dollar/Euro: $1.1322 -$0.0046

Dollar Index: 99.52 +0.24

Gold: $3,320.10 -$23.80

Bitcoin: 105,849 +115

Crude Oil: $60.45 -$0.49

DJIA: 42,224 +9

NASDAQ: 19.082 -93

S&P 500: 5898 -14

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.