• This holiday-shortened week has only three relevant monthly or quarterly economic reports for the markets to digest, one of which is considered highly important. There is also a Treasury auction that may come into play midweek and a speech by President Trump.

 • The stock and bond markets will be closed tomorrow for the Martin Luther King Jr holiday and will reopen for regular trading Tuesday. There will be no update to this report tomorrow.

 • There is no relevant economic data set for release Tuesday or Wednesday.

 • President Trump is expected to speak Wednesday morning at the annual Davos World Economic Forum in Switzerland. He likely will speak more about political issues than financial matters that would be relevant to mortgage pricing. His recent threat to add tariffs to any countries that don’t support his plans to acquire Greenland does fall under the relevant category, but how the markets will react is unknown.

 • This week’s first regularly scheduled event will be a 20-year Treasury Bond auction that is also taking place Wednesday. These auctions show what type of demand investors have for longer-term securities. If demand is strong, particularly from international buyers, we may see the broader bond market improve after results are posted at 1:00 PM ET.

 • Thursday has two monthly reports scheduled for release in addition to the weekly unemployment update. First will be the weekly unemployment numbers and the revised 3rd Quarter Gross Domestic Product (GDP) reading at 8:30 AM ET.

 • The GDP measures the total of all goods and services produced in the U.S., making it the benchmark measurement of economic growth. Last month's delayed preliminary estimate of a 4.3% annual rate of growth surprised many since forecasts had that estimate at 3.2%. Most analysts are expecting the revised reading to match the 4.3% that was announced last month. Since this data is old now (July through September) and comes on the same morning as a major report, it likely will have no impact on mortgage rates regardless of what it shows.

 • The most important of Thursday’s three releases is the Personal Income and Outlays report that will give us an indication of consumer ability to spend and their current spending habits. This is a combination of October and November’s data since both were delayed by the government shutdown. While the income and spending readings are moderately influential, it is the Personal Consumption Expenditures (PCE) indexes in the data that elevate the importance of the report.

 • Current forecasts show a 0.4% increase in income and a 0.5% rise in spending. Analysts are also expecting the overall and core PCE readings to both have increased 0.2% and annual readings to have risen slightly. Favorable news for rates would be weaker than predicted readings, especially in the PCE indexes.

 • January's preliminary reading to the University of Michigan's Index of Consumer Sentiment will finish this week's calendar late Friday morning. By theory, if consumers feel better about their own financial and employment situations, they are more apt to make a large purchase in the near future. Stronger consumer spending numbers translate into economic growth that makes stocks more appealing and bonds less attractive to investors. Predictions show little change from December's 54.0. The lower the reading, the better the news for bonds and mortgage rates.

 • Also worth mentioning is that corporate earnings season gets into full swing this week. There are plenty of big-named public companies announcing their quarterly and annual earnings this week. If the common theme is disappointing results from the bellwether companies, a strong negative reaction in stocks could fuel bond buying that pushes yields lower. This would be good news for mortgage shoppers since mortgage rates tend to track bond yields.

 • Overall, Thursday looks to be the most important day for rates due to the importance the PCE indexes carry. If President Trump gives us a major surprise Wednesday, we could also see a noticeable move in rates that day.

 • The calmest day may be Friday since Tuesday could be a bit volatile following the three-day weekend.

 • We are now in the Fed’s mandatory pre-FOMC quiet period, meaning Fed speeches should not be a factor this week.

 • Even though there is not a large number of scheduled events this week, there still is a high probability of seeing movement in mortgage rates multiple days. Therefore, it would be prudent to keep an eye on the markets if still floating an interest rate and closing in the near future.

 • 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... 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.