• Thursday’s mortgage rates should be fairly close to Wednesday’s early pricing. If you saw an intraday improvement in rates yesterday afternoon, you should see an increase this morning. The bond market is currently down 7/32 (4.64%).

 • Stocks are mixed with the Dow down 40 points and the Nasdaq up 94 points.

 • Yesterday afternoon’s speech by Fed Governor Lisa Cook generated a couple of headlines but no big surprises. In short, she stated she was ready to vote for an increase in key short-term interest rates if inflation does not retreat soon.

 • Initially, the bond market usually takes news of a potential rate hike as a negative because it signals the Fed is concerned about rising costs, which is the bond market’s number one nemesis. Rising inflation erodes the value of a bond’s future fixed interest payments, making them less appealing to investors.

 • However, the Fed’s actions are intended to bring down inflation, eventually making bonds more attractive to investors. While we are seeing a negative reaction to current headlines about the Fed potentially raising rates, it is important to remember that their longer-term goals, if successful, will also lead to lower mortgage rates down the road.

 • Last week’s unemployment update was the first of this morning’s two 8:30 AM ET economic releases. It revealed 199,000 new claims for jobless benefits were made last week, up slightly from the previous week’s revised 198,000 initial filings. Analysts were expecting to see 201,000 new claims, so the 199,000 figure is a slight disappointment to bond traders.

 • This morning’s productivity release gave us the favorable news. It showed that worker productivity grew at a 1.4% annual pace, exceeding forecasts of 0.7% by a healthy margin. Since higher levels of productivity allow for the economy to grow without inflationary pressures building, the stronger number is good news for bonds and mortgage rates.

 • A secondary reading in the productivity report showed labor costs held at the first quarter’s downward revised level of 1.3% when it was predicted be up 2.2%. Lower costs for wages helps to prevent businesses from passing them onto the costs of their products and services, helping to prevent inflation from rising further.

 • This week’s scheduled activities come to an end early tomorrow morning when July’s governmental Employment report is being released. It will give us the U.S. unemployment rate, number of jobs added or lost during the month and average hourly earnings. Forecasts show 85,000 new payrolls were added last month, while the unemployment rate held at June’s 4.2%. Earnings are predicted to have risen 0.3%.

 • Good news for rates tomorrow would be a smaller payroll number, higher unemployment rate and flat earnings. This is one of the most influential monthly reports the financial markets see, meaning any surprises could cause a fair amount of volatility in the markets and mortgage pricing tomorrow.

 • Visit our Daily Commentary page on our site for detailed explanations on current news that is relevant to mortgage rates.

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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... Float 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.