Mixed Economic Data
- Mortgage Returns
- Jun 11
- 2 min read

Overview: While news about tariffs continued to add volatility in mortgage markets over the past week, its lasting influence was relatively small. This week’s economic data provided a mixed message about inflation. The most recent inflation report was lower than expected, but wage gains exceeded the consensus forecast, increasing future inflationary pressures. The net result of this offsetting data was that mortgage rates ended the week with little change.
The highly anticipated Employment Report revealed that the economy added 139,000 jobs in May, above the consensus of 130,000, but downward revisions to the results for prior months subtracted 95,000. Strength was seen in health care, leisure/hospitality, and social assistance, while the government sector lost jobs. The unemployment rate remained at 4.2%, as expected. Average hourly earnings were 3.9% higher than a year ago, up from an annual rate of 3.8% last month and well above the consensus forecast. Faster wage growth causes investors to raise their outlook for future inflation.
According to the latest data, current inflation levels are lower than expected. The Consumer Price Index (CPI) is one of the most closely watched inflation indicators released each month. To reduce short-term volatility and get a better sense of the underlying inflation trend, investors look at core CPI, which excludes food and energy. In May, core CPI rose just 0.1% from April, far below the consensus forecast for an increase of 0.3%. It was 2.8% higher than a year ago, the same annual rate of increase as last month, remaining at the lowest level since March 2021.
While this annual rate has dropped significantly from a peak of 6.6% in September 2022, it is still far above the readings around 2% seen early in 2021, which is the stated target level of the Federal Reserve. Shelter (housing) costs continue to be the main reason why progress on bringing down inflation remains difficult. Used vehicle prices saw their third straight monthly drop. New vehicle prices and apparel also posted sizable declines in May. The big question remains how much impact tariffs will have on future inflation levels.
In March, the U.S. trade deficit spiked to around $140 billion, shattering the previous record. Companies and consumers were rushing to beat higher prices due to new tariffs. The turbocharged results lasted for just one month, however, as more normal levels returned in April. The deficit dropped by more than half to just $62 billion, which was below the consensus forecast. Imports fell by an enormous 16% from March, while exports increased a bit.
Job Gains (thousands)

Week Ahead
June 17
Retail Sales report
Import and Export Price Indexes
June 18
New Residential Construction report (also known as Housing Starts)
Federal Reserve meeting
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