Thursday's bond market opened in positive territory following sizable stock losses during early trading. The Dow is currently down 124 points while the Nasdaq has lost 17 points. The bond market is currently up 15/32, which with yesterday's late losses again will push this morning's mortgage rates higher by approximately .500 - .625 of a discount point.

Yesterday's Fed Beige Book indicated that economic activity is slowing throughout the U.S. but also that inflationary pressures are rising. This led to selling in bonds late yesterday and upward revisions to mortgage rates. This morning's bond gains helped erase some of yesterday's late losses, but not enough to prevent mortgage rates from jumping higher this morning.

Today's only economic data came from the Labor Department who said that 351,000 new claims for unemployment benefits were filed last week. This was lower than expected and could be considered a minor negative for bonds. However, wi th tomorrow's monthly data being posted, today's weekly numbers are not of much importance.

The biggest news of the week comes tomorrow morning when one of the single most important monthly reports we see will be posted. The Labor Department will release February's Employment report at 8:30 AM ET tomorrow. Some of the important portions of the report will give us the unemployment rate, number of new jobs added or lost and the average hourly earnings reading. The best combination for the bond market and mortgage rates would be an increase in the unemployment rate, a large drop in payrolls and little or no increase in earnings. Current forecasts are calling for 0.1% increase in the unemployment rate to 5.0% and approximately 25,000 new jobs added.

I am expecting to see a fair amount of volatility in the markets tomorrow following the release of this data. However, I am still holding the lock recommendations as I believe that bad news is built into curren t rates. If we simply match forecasts, we probably will not see much of an improvement in rates tomorrow. But, if the numbers come in a little stronger than expected, we could see bond prices fall quickly and mortgage rates spike higher. In other words, it is my opinion that we will need to see much weaker than expected readings to see much an improvement in mortgage rates tomorrow.

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... Lock 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.

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