Treasuries rallied as inflation last month eased in the US by slightly more than economist had predicted, reinvigorating some bets that the Federal Reserve will lower interest rates further this year.

As mentioned, mortgage rates haven't fallen in line with the Fed's rate cuts because they depend on factors beyond the agency's benchmark rate, such as the economy and 10-year Treasury bond yields. For example, when the 10-year treasury rate goes up, mortgage rates tend to follow, and vice-versa.

The stock market's stiffest headwind, a surge in Treasury bond yields, was blown aside Wednesday by a surprisingly benign inflation report, which could rekindle bets on multiple Federal Reserve rate cuts before year-end.

However, stubbornly high inflation still presents a tough challenge for the Federal Reserve and the S&P 500 as President-elect Donald Trump is set to take office, because his poli

Consumer price index data for December showed that core price pressures eased more than expected. S&P 500 futures rose as Wall Street weighed the CPI's implications for Federal Reserve policy as well as positive earnings reports from Dow Jones giants JPMorgan Chase and Goldman Sachs.