Huge Drop in Mortgage Rates After Friendly Inflation Data

Huge Drop in Mortgage Rates After Friendly Inflation Data

Another Big November Rally After CPI There's something about CPI releases in November.  Last year's example prompted one of the biggest single-day, data-driven bond market rallies on record.  This year's isn't far off--a fact made all the more stunning by the mere 0.1% beat (Core monthly CPI 0.2 vs 0.3 f'cast).  There are a few ways to try to explain the size of the reaction. On a nitty gritty note, the problematic housing component fell from 0.6 to 0.3.  On a more general note, it's possible the bond market was more interested in "no whammies" than a sweeping reversal of inflationary pressures.