Consumer Economy
- Existing Home Sales (EXHOSLUSM495S) 4.06M -70.0K (-1.69% m/m)
- CPI All Urban (CPIAUCSL) +0.07% m/m
- Producer Prices (PPIACO) 284.1 -2.22 (-0.78% m/m)
- Retail Sales (RSAFS) 763.6B -4.5B (-0.58% m/m)
Existing Home Sales continue to move sideways at the lows.
BLS pretended that inflation was only 0.07% m/m. If you care to see the lies in detail:
https://www.bls.gov/news.release/cpi.t01.htm#cpipress1.f.1
Column 6: June 2026 – July 2026
Case study: Gasoline = -2.1% m/m.
- Gasoline Futures [end of June] = 2.89
- Gasoline Futures [end of July] = 3.11
That’s a 7.6% increase.
PPI fell this month also; it is down from its all-time high that hit back in May.
Retail Sales (seasonally adjusted, but not adjusted for inflation) also fell; the release caused a momentary rally in TLT on Friday, but that lasted just five minutes, after which TLT sold off again, ending Friday down -0.67%.
In the sub-groups: Motor vehicle sales plunged (-2.05% m/m), Non-store sales fell (-2.25%), food & bev were flat (+0.05%), while clothing sales rose (+1.90%).
Plunging retail sales – if it continues – is definitely recessionary. The chart below is RSAFS and RSAFSNSA, just to show why they “seasonally adjust” the series.
Credit & Rates
- Total Bank Credit (TOTBKCR) 19.78T +20.3B (+0.10% w/w)
- Fed Balance Sheet (WALCL) 6.76T +11.4B (+0.17% w/w)
- US 30 Year Mortgage Rate (MORTGAGE30US) 6.67% -2 bp
- 3-Month Treasury (DGS3MO) 3.80% -7 bp
- 1-Year Treasury (DGS1) 3.97% -4 bp
- 10-Year Treasury (DGS10) 4.70% +5 bp
- 30-Year Treasury (DGS30) 5.26% +7 bp
- 20+ Treasury ETF (TLT.N) -0.87% w/w
- US Confidence (AAA10Y) 1.22% (+0.02 bp w/w)
Bank Credit increased somewhat (+5.2% annualized), while Fed Printing was half as much (+11B) in dollar terms, but substantially larger as a percentage (+8.8% annualized). Over the 4-week average, Bank Credit growth continues to strongly outperform Fed Printing.
In Treasurys, money moved into the short end of the curve, and out of the long end, with the 30-year taking the biggest hit. “No Inflation!” CPI Wednesday caused a very brief drop in rates – maybe 5 minutes long.
While both CPI and PPI said “no inflation”, this week’s rise in long rates seemed to be more about Endless War and/or maybe the carry trade unwinding. The decline in short rates (especially the 1-month) feels like a near-term flight
