Daily Market Update 5/22/15

Rates held steady Friday in spite of higher than expected inflation data.  This morning, the April Consumer Price Index (CPI) rose 0.1%, matching forecast, but Core CPI, which excludes volatile food and energy components, jumped 0.3%, the largest monthly increase since January 2013.  Core CPI was 1.8% higher than one year ago, slightly below the Fed target rate for inflation of 2.0%.  Federal Reserve Chairwoman Janet Yellen will be speaking at 1:00 PM.  Market volume will be lighter than usual ahead of the holiday weekend, meaning Yellen’s comments could result in greater volatility.  Mortgage-backed securities markets will close today at 2:00 PM.

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