In a report this morning, the Bureau of Labor Statistics announced that its headline Producer Price Index rose by 0.4% in September and that was twice the rise that analysts expected. Last month’s gain took the year-over-year rate to 0.4% from August’s minus 0.2%. Without food and energy, core PPI also rose by 0.4% versus an estimate of 0.2%. Year-over-year, that rate rose to 1.2% from August’s 0.6%; pre-release estimates were only looking for 1%. Earlier in the day, the Mortgage Bankers Association announced that Mortgage Applications fell 0.7% for the week ending October 9th.
Treasury prices were already up a bit prior to this morning’s data releases and are little changed on the news. The Ten-Year’s yield has fallen slightly to 72 basis points as the Long Bond’s yield has broken below 1.50%. Crude oil is unchanged at $40 while gold’s $14 rally has taken that price to $1,905. The DJIA is mildly green in pre-opening trading.