Daily Market Update 9/15/11

Mortgage rates moved modestly higher Thursday following the release of a wide range of economic data.  The August Consumer Price Index (CPI) rose 0.4%, above the consensus forecast of 0.2%, and was 3.8% higher than one year ago.  Core CPI, which excludes volatile food and energy components, increased 0.2%, matching expectations, and rose 2.0% year-over-year.  Weekly Jobless Claims jumped to 428,000, well above forecast, but weather-related issues may have inflated the results.  Industrial Production rose 0.2%.  An increase of 0.1% had been expected.  The Philly Fed Index, a survey of manufacturing activity in Pennsylvania, New Jersey, and Delaware, came in at -17.5.  Readings below zero indicate contraction in the manufacturing sector.  In other news, five major central banks, including the ECB and U.S. Federal Reserve, will provide lending for European banks seeking short-term liquidity.  The announcement boosted stocks, hurting bonds and mortgage-backed securities.  No other key data will be released today.

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