This week had several very important economic reports scheduled to be released, along with a few that are considered to be moderately important. However, the government shutdown is preventing almost all of them from being posted. In lieu of those reports, the markets will be relying on other headlines and Fed-member speeches to drive bond trading this week. The bond market will be closed tomorrow for the Columbus / Indigenous Peoples' Holiday. This means there will not be an update to this report. U.S. stock markets will be open for a full trading day though.

There is at least one Fed speech scheduled each day this week, including tomorrow. These speeches often are about mundane topics such as community banking and global payment systems that have no impact on rates. Others have topics related to the economy or monetary policy that can affect the financial and mortgage markets. Most of this week’s speeches are of no concern. The two that stand out as likely to draw a reaction are Fed Chairman Powell’s 12:20 PM ET Economic Outlook and Monetary Policy speech at a business conference in Philadelphia Tuesday and Fed Governor Waller’s Economic Outlook speech Thursday at 9:00 AM ET in New York.

Friday afternoon’s huge sell-off in stocks and rally in bonds was due to an unexpected announcement from President Trump that indicated he was considering a huge tariff increase on all goods coming from China. The size of the increase (100%) caused both the Dow and Nasdaq to lose over 800 points before closing for the week. Comments from President Trump since then has some traders thinking the new tariff may not actually happen. This has stock futures currently looking like stocks will rally tomorrow to recover a good part of Friday’s losses. This won’t be an issue for bonds tomorrow, but if stocks do rally, we can expect bonds to follow suit by giving back some or all of Friday’s gains Tuesday morning.

The week’s only relevant release will be the Federal Reserve's Beige Book report Wednesday afternoon. It summarizes economic activity through the eyes of business contacts within each Fed region. The Fed relies heavily on this data during their FOMC meetings when making monetary policy decisions, so look for a potential reaction during mid-afternoon trading. It probably will not cause a big sell-off in the stock or bond markets, but the 2:00 PM ET release is still worth watching as it could draw enough of a reaction to change rates if it reveals any major changes since the last update.

Also worth noting is corporate earnings season starts this week, when a large number of big-named companies release their quarterly and annual earnings reports. Strong earnings are good news for stocks and bad news for bonds. Generally speaking, if earnings miss expectations, stocks should lose ground while bonds rally and mortgage rates should move slightly lower. With a number of well-known large banking and financial companies posting this week, stocks could also have a heavy influence on bond trading and possibly mortgage pricing.

Overall, Tuesday morning could be the most active day for rates due to Fed Chairman Powell’s speech and the potential reversal of Friday’s bond gains. Any day could be the calmest with so little scheduled this week. Despite the lack of relevant economic data or other key events to affect mortgage rates, it sill would be prudent to keep an eye on the markets if still floating an interest rate and closing in the near future.

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.