The Producer Price Index for December is lower than expected

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Published Date 1/12/2024

December producer prices released at 8:30 am ET, prior to the release the 10 year note yield at 4.01% +4 bps. Inflation declined from estimates, initial reaction dropped the 10 year note from 4.01% to 3.96%. PPI month/month expected +0.2% declined 0.1%, and down 0.1% from November, year/year expected +1.3% increased just 1.0%. Core PPI (ex-food and energy) month/month expected +0.2% reported 0.0%, year/year forecasts +2.0% but increased 1.8%.

Yesterday’s CPI was slightly hotter than forecasts but was ignored with outlooks for Fed rate cuts remains strong. By the end of yesterday the 10 declined 6 bps and MBS prices increased 36 bps.

JPMorgan, Bank of America Corp, Citigroup, and Wells Fargo & Co. — are all reporting results today. The kickoff to earnings season that will continue for a month with businesses rolling out Q4 results. Citi’s Jamie Dimon reminding that the continued increase in government spending “may lead inflation to be stickier and rates to be higher than markets expect.”

The US and UK struck multiple Houthi targets in Yemen retaliating against recent Red Sea attacks on commercial shipping routes. The US warning there will be more coming unless Iran-backed Houthis back off, meantime Houthis saying they will increase attacks. Crude oil in early trade increased over $3.00. Gold prices up over $21.00 at 9 am.

At 9:30 am the DJIA opened +55, NASDAQ +36, S&P +16. 10 year note at 9:30 am 3.94% -3 bps from yesterday. FNMA 6.0 30 year coupon at 9:30 am +7 bps from yesterday’s close and +37 bps from 9:30 am yesterday.

There isn’t anything left on the calendar today.

Source: TBWS

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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.

This communication (including attachments) is for information purposes only. It is not an offer, solicitation, recommendation, or commitment for any transaction or as a confirmation of any transaction.  Bobbie Jo Haggard, NMLS #92472; Heartland Mortgage Inc, NMLS #3205; Office: (509) 529-3280; Licensed to business in Washington & Oregon; NMLS CONSUMER ACCESS WEBSITE:  HTTPS://www.NMLSConsumerAccess.org

Bobbie Jo Haggard

Loan Officer / Mortgage Specialist

NMLS: #92472 - Washington & Oregon

Heartland Mortgage Inc.

30 S Palouse Street, Walla Walla WA 99362

Company NMLS: #3205

Office: 509-301-1661

Cell: 509-301-1661

Email: BobbieJo@HeartlandMortgageInc.com

Web: https://www.WallaWallaMortgage.com