• Tuesday’s mortgage rates should be higher than Monday’s early pricing by approximately .375 of a discount point. The bond market is currently down 12/32 (4.39%).

 • Stocks are reacting to the same headlines, taking back a good portion of yesterday’s short-lived rally. The Dow is currently down 248 points while the Nasdaq has lost 169 points.

 • Today’s only economic news was revised Productivity numbers for the 4th Quarter of last year at 8:30 AM ET. They showed worker output per hour grew at a 1.8% annual pace during the final three months of the year, which was a much slower pace than the 2.8% that was announced previously and also fell short of forecasts.

 • What is almost exclusively driving the markets this morning are headlines from Iran that they exchanged military strikes with Israel overnight. This news undermines President Trump’s comments about peace talks and fuels the theory that the conflict is going to carry on for longer than some people originally anticipated.

 • This morning’s news has oil prices up again, contributing to inflation concerns. Furthermore, an extended conflict likely raises the overall price tag for the war, meaning more debt needs to be sold to cover the costs. Both situations are negative for the bond market and mortgage rates.

 • There is no relevant economic data scheduled for release tomorrow, leaving geopolitical headlines to drive the markets.

 • Any news that indicates the conflict may come to an end soon, or that oil and other shipping will have safe passage through the Strait of Hormuz, will cause oil prices to drop and inflation fears to subside a little. The end result would likely be lower bond yields and an improvement in mortgage pricing.

 • Tomorrow does have an afternoon event that may have a modest impact on rates. There is a 5-year Treasury Note auction happening tomorrow. If the sale goes poorly with weak demand from investors, we could see selling in the broader bond market that leads to a slight upward afternoon revision in mortgage rates. Results will be posted at 1:00 PM ET, so look for any reaction to come during early afternoon hours.

 • It is worth noting that this week’s auctions are for shorter-term debt, which is not nearly as influential as the other sales we follow because mortgage rates are based on long-term securities.

 • 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.