Monday’s bond market has opened in negative territory despite a negative open in stocks. The Dow and Nasdaq are both showing early losses with the Dow down 47 points and the Nasdaq down 6 points. The bond market is currently down 3/32, which should keep this morning’s mortgage rates near Friday’s morning levels.

There are only three pieces of relevant economic data scheduled to be posted this week along with a couple of Treasury auctions, none of which will come today. Only one of the three reports is considered to be of high importance, while one is moderately important. The third is not considered to be of much importance unless it varies greatly from forecasts.

The first report comes Wednesday morning and is the least important of the three. That is when December’s Goods and Services Trade Balance data will be posted. This report measures the U.S. trade deficit and can affect the value of the U.S. dollar versus other currencies, but it usually does not cause enough movement in bond prices to affect mortgage rates. It is expected to show a $35.0 billion trade deficit.

The two important Treasury auctions come Wednesday and Thursday when 10-year Notes and 30-year Bonds are sold. The 10-year sale is the more important one as it will give us an indication for demand of mortgage-related securities. If the sales are met with a strong demand from investors, we should see the bond market move higher during afternoon trading the days of the auctions. But a lackluster interest from buyers, particularly international investors, would indicate a waning appetite for longer-term U.S. securities and lead to broader bond selling. The selling in bonds would likely result in upward revisions to mortgage rates.

Overall, look for Thursday to be the most important of the day of the week due to the importance of the Retail Sales report. But, I suspect that we may see movement in mortgage rates several days this week. I am still holding a cautious approach stance towards mortgage rates and believe that the risk of floating a rate outweighs the potential gains. Therefore, please be careful if still floating an interest rate this week.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.