CHM Blog

Weekly jobless claims expected at 229K reported at 229K, continuing claims edged slightly higher to 1,881 million in the first week of May, slightly below market expectations of 1,990 million. The result continued to reflect a resilient labor market when compared to historical levels. Claims at the end of April were 241K. Initial unemployment claims filed under programs for Federal government employees, which have been under scrutiny due to firings by the Department of Government Efficiency (DOGE), fell by 30 to 438.

Last Tuesday April CPI data was lower than forecasts. This morning the producer price index also softer than estimates forecasts were month/month +0.2% reported -0.5, year/year +2.4% as expected but down from 2.7% in March. Core PPI month/month -0.4% against estimates of +0.3%, the first decrease in core producer prices in five months. Year/year expected at 3.0% increased 3.1%. Excluding food, energy and trade services month/month thought to be +0.3% declined 0.1%, year/year +2.9% from 3.4% in March. Based on April CPI and PPI inflation is better than what was anticipated. PPI shows sharpest drop in wholesale-level inflation since 2020.

April retail sales +0.1% as expected after increasing 1.7% in March as consumers rushed to buy ahead of any tariffs. Excluding vehicles +0.1% with forecasts of +0.3%; ex-vehicles and gas +0.2% from +1.1% in March.

May Philadelphia Fed business index -4.0 against estimates of -10 and better than -26.4 in March.

At 9:15 am ET April industrial production thought to be +0.2% was lower at 0.0%. Capacity utilization expected at 77.9% dropped to 77.7%, March 77.8%.

At 9:30 am the DJIA opened -219, NASDAQ -117, S&P -21. 10 year at 9:30 am 4.49% -5 bps. FNMA 6.0 30 year coupon at 9:30 am +10 bps from yesterday’s close and -4 bp from 9:30 am yesterday.

Jerome Powell this morning talking about the Fed’s review of its policy. It’s been five years since the Fed’s current polices have been reviewed. The review of Fed policy is focused on a separate document not the six week FOMC meetings, typically reissued every January, that outlines the Fed’s approach to setting rates. The Fed’s review, started this year, may not impact current rate decisions. Results are expected by August or September. “The economic environment has changed significantly since 2020, and our review will reflect our assessment of those changes,” Powell said. Changes to Fed’s rate-setting framework unlikely to influence current decisions but acknowledge ‘lower-for-longer’ interest-rate era may be over. Powell spoke at a research conference at the central bank’s headquarters in Washington.

At 10 am May NAHB housing market index expected unchanged at 40, reported at 34. We will have details this afternoon.

PRICES @ 10:00 AM

10 year note: 4.49% -5 bp

5 year note: 4.11% -6 bp

2 year note: 3.99% -7 bp

30 year bond: 4.95% -2 bp

30 year FNMA 6.0: @9:30 am 100.63 +20 bp (-4 bp from 9:30 am yesterday)

30 year FNMA 6.5: @9:30 am 102.42 +11 bp (-4 bp from 9:30 am yesterday)

30 year GNMA 6.0: @9:30 am 100.60 +11 bp (-7 bp from 9:30 am yesterday)

Dollar/Yen: 145.79 -0.96 yen

Dollar/Euro: $1.1200 +$0.0027

Dollar Index: 100.77 -0.27

Gold: $3,194.40 +$6.10

Bitcoin: 102,190 -1113

Crude Oil: $61.66 -$1.49

DJIA: 41,886 -166

NASDAQ: 19,005 -142

S&P 500: 5877 -16

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.