Source: US Dept. of Treasury End of Day
• Rates fell slightly last week with the 2-year Treasury note decreasing by three basis points to 4.18% while the 5-year Treasury note decreased by two basis points to 4.29%.
• Softer-than-expected June inflation reduced pressure on the Fed, with headline CPI declining for the first time since 2020 and markets sharply lowering expectations for additional rate hikes.
• Housing is emerging as a key disinflation driver, as slowing rent growth and a surge in multifamily construction increase supply and help contain shelter costs.
• Renewed U.S.-Iran tensions have reintroduced upside inflation risks, as higher oil prices threaten to reverse recent declines in energy costs and weigh on household purchasing power.
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