The past two weeks have been challenging for rates, as indicated by the latest data on Personal Consumption Expenditures (PCE). Inflation has increased by 0.4% in April, surpassing the estimated 0.3% rise.

Energy rose 2.4% last month and Used Cars up 4.7%.

There is indeed a positive aspect to consider. We expect to observe progress in the coming two months due to higher comparisons with last year’s inflation rates. It’s important to note that we are focusing on year-over-year inflation comparisons.

Looking back at 2022, the inflation rates for May and June were 0.6% and 1.0%, respectively. If we continue to see readings around 0.4%, we can anticipate a decrease in year-over-year inflation from 4.4% to 3.6%. Furthermore, we project that inflation will decrease even further once the pressure from energy, used car prices, and shelter costs subsides.

Have a fantastic long weekend. Bond Market will be closing today at 2:00pm ET in observance of Memorial Day Holiday and the markets will be closed on Monday.