The higher-than-forecast 0.4% rise in the CPI in May (with core CPI +0.3% also ahead of estimates) sends Treasury yields higher, with the 10-year up two basis points to 2.62%. TLT -0.3%, TBT +0.6%. At the short end, Dec. 2016 Eurodollar futures are lower by 4 basis points (thus pricing in a higher Fed Funds rate at that time).
Previously: May CPI at +0.4%, exceeds consensus
On the flip side, housing starts in May disappointed, slipping 6.5% from April's pace. The annual rate of 1M is still 9.4% ahead of the pace in May 2013. Single-family housing starts in May of 625K were 5.9% lower than April.
Building permits of 991K were 6.4% lower than April and down 1.9% from a year ago.
Previously: Housing starts a bit shy of forecast
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