• This week has just a few pieces of relevant economic data scheduled to be posted but one of them is a major release. In addition to the data, there is another Treasury auction along with the sixth FOMC meeting of the year.

 • The week starts light with nothing of importance scheduled for tomorrow, the only day of the week without at least one scheduled event.

 • Tuesday also lacks any relevant economic releases, but there is a 20-year Treasury Bond auction to start this week’s activities. If the sale is met with a strong demand from investors like last week’s sales were, bond prices may rise and mortgage rates could revise lower after results are announced at 1:00 PM ET.

 • Wednesday will start with the release of August's Retail Sales report at 8:30 AM ET Tuesday. This report will give us details about consumer spending, which is highly important to the markets because that category makes up over two-thirds of the U.S. economy. Current forecasts show a 0.8% increase in sales. Good news for the bond market and mortgage pricing would be a much smaller increase, or better yet- a decline.

 • Next up is the much anticipated FOMC meeting Wednesday afternoon. Not too long ago, there was plenty of debate regarding whether or not the Fed would raise key short-term interest rates before the end of the year. Last week changed those odds drastically.

 • The significant spike in oil prices that brought one benchmark above $105 per barrel last week, the fact the Iran war not only has no end in sight but is now expanding to other countries in the Middle East and inflation data that didn’t ease concerns drove bond yields to a high point we haven’t seen in many years.

 • The chance of a rate hike coming during this week’s meeting is now very high. The Federal Reserve raises rates when they want to slow economic activity and bring inflation down, while lowering them is intended to boost economic growth when it is too slow.

 • Now that a potential rate hike is right in front of us, it is important to remember that the Fed’s goals are in line with what the bond market wants to see also. Rising inflation makes a long-term bond’s future fixed interest payments less appealing to investors today. This is why bond prices have been moving lower, pushing their yields (and mortgage rates) higher.

 • If the Fed is successful in bringing inflation back down near their 2.00% target rate, bonds should thrive and mortgage rates would move lower. In other words, don’t be surprised to see a bond rally and mortgage rates move lower if the Fed does take action at this week’s meeting.

 • If the Fed votes to not make a change to key rates this week, we could see bond yields and mortgage rates rise higher than where they closed at Friday afternoon.

 • The meeting will adjourn at 2:00 PM ET Wednesday, which is also when we will get their post-meeting statement and revised economic projections. Those economic projections also include the Fed's so-called Dot Plot that tells us where individual Fed members think these short-term rates will be in the future.

 • August's Housing Starts report will be posted at 8:30 AM ET Thursday. It helps us measure housing sector strength and future mortgage credit demand by tracking new home groundbreakings. However, this report is usually considered to be of low importance and often has just a minimal impact on rates. It is expected to show new home groundbreakings rose a little from July, pointing to a bit of strength in the new home portion of the housing sector.

 • Industrial Production data for August is set to be released at 9:15 AM ET Friday. It will give us an indication of manufacturing strength by tracking output at U.S. factories, mines and utilities. Analysts are expecting to see production was 0.3% higher than it was in July, a sign that manufacturing activity gained modest momentum last month. A larger increase in production would be negative for bonds and mortgage rates, while a decline would be favorable for mortgage shoppers.

 • The Conference Board will close this week's calendar when they release their Leading Economic Indicators (LEI) for August at 10:00 AM ET Friday. This index attempts to predict economic activity over the next three to six months. Forecasts show a 0.2% increase, meaning the indicators are pointing toward slightly stronger economic activity in the coming months. A decline in the indicators would be favorable news for mortgage pricing.

 • Overall, Wednesday is easily the most important day of the week since it has the most influential data and FOMC events. We may see rates move in the morning and again, at least once maybe more, during late afternoon hours.

 • The calmest day for rates will probably be Friday since weekend headlines from the Middle East may draw a reaction tomorrow.

 • We are likely going to see plenty of movement in the financial markets and mortgage rates this week, so it would be prudent to keep an eye on them if 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... 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.