Ep 153 - CPI SHOCK | 3 Reasons Mortgage Rates Will Still Drop

Will mortgage interest rates drop despite the recent CPI shock? In this episode, Quinton Harris pulls the curtain back on the 0.1 CPI reading that rattled the market and explains why there's still hope for lower mortgage rates. He discusses the flawed system of shelter cost in the CPI, the Federal Reserve's focus on the PCE rather than the CPI, and the encouraging signs of evaporating spreads between the 10-year treasury and 30-year fixed-rate mortgages. Despite the initial overreaction, Quinton remains optimistic that rates in the 6% range will return sooner than expected, even without a Fed rate cut.

[00:00 - 01:04] - CPI shock and market reaction

[01:05 - 02:07] - Shelter cost and rent in CPI

[02:08 - 04:07] - CPI, PPI, and PCE differences

[04:08 - 05:55] - PPI impact on PCE

[05:56 - 07:01] - CPI, PCE gap and impact

[07:02 - 09:20] - 10-year, 30-year spread hope

[09:21 - 12:33] - Lower rates without Fed cut

Key Quote:
“The CPI basically took a rate cut option off the table” - Quinton Harris

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