Rates inched higher Friday reflecting market activity that occurred late Thursday. Yesterday, bonds and mortgage-backed securities sold off following a disappointing 7-year Treasury auction. Trading has been volatile this morning. In economic news, the April Core PCE price index, the Fed’s preferred measure of inflation, rose 0.2% and was a tame 1.4% higher year-over-year. Personal Income rose 0.3%, matching expectations. The Chicago Purchasing Managers Index, a survey of manufacturing activity in the Midwest region, jumped to 65.5, well above the consensus forecast of 61.0. Readings above 50.0 indicate expansion in the manufacturing sector. Consumer Sentiment came in at 81.9, slightly lower than expected. No other key data will be released today.