About two weeks ago, we talked about the rapid increase in inflation the US saw over the last five months showing a 1.4% gain with a 2% annual Fed target. This morning, we got the Consumer Price Index report which showed Octobers inflation held just about flat from September. This abrupt slowdown in inflation is influenced by a number of factors; however, the likely leader is the fear of another economic shutdown as COVID spikes across the nation.
We also got jobs numbers in today. The Initial Jobless Claims came in lower than expected at 709k new claims last week. While these jobless claims number are improving slowly, this is a positive sign for the recovery of the economy especially when paired with the decreasing continuing claims number of 6.8 million.
Mortgage backed securities are up this morning. However, we are aiming for a double ceiling that may cause some turbulence. We hold a locking bias.