Tuesday’s bond market has opened in negative territory following stronger than expected consumer spending numbers. Stocks are rallying with the Dow up 346 points and the Nasdaq up 93 points. The bond market is currently down 6/32 (4.27%), which should cause an increase of approximately .125 of a discount point in this morning’s mortgage rates.

March Retail Sales report was released at 8:30 AM ET this morning, revealing consumers spent much more last month than many had thought. The 1.7% rise in retail-level sales exceeded forecasts of a 1.4% increase. A secondary reading that excludes more volatile and costly auto sales also exceeded expectations (up 1.9% vs 1.2%). These numbers are a sign that consumers continued to spend last month. Because consumer spending makes up over two-thirds of the U.S. economy and bonds are less appealing to investors during stronger economic times, this morning’s report is bad news for mortgage rates.

There is no relevant economic data scheduled for release tomorrow. The only scheduled event that we will be watching is the 1:00 PM ET results announcement of the 20-year Treasury Bond auction. If the results show there was a strong demand for the securities, we could see bonds improve this afternoon, possibly leading to a minor improvement in mortgage pricing. On the other hand, a lackluster interest from investors could cause a slight upward revision to rates before the end of the day.

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.