By James Brooks

The bond market is up 4/32 (2.14%), which should improve today's mortgage rates by approximately .125 of a discount point.

Tomorrow brings us the release of two reports, one of which is much more important than the other. The more influential release is July's Retail Sales data at 8:30 AM ET tomorrow. This report comes from the Commerce Department and will give us a very important measurement of consumer spending. Consumer level spending figures are extremely relevant to the markets because it makes up over two-thirds of the U.S. economy. Current forecasts are calling for a 0.5% increase in sales. Analysts are also calling for a 0.5% rise in sales if more volatile auto transactions are excluded. Larger than expected increases would be considered bad news for bonds and likely lead to an increase in mortgage pricing since it would indicate stronger economic growth.

The second report of the morning will be last week's unemployment figures. They are expected to show that 270,000 new claims for benefits were filed, matching the previous week's total. Ideally, we want to see a large increase in initial claims, indicating employment sector weakness. The higher the number of claims, the better the news it is for mortgage rates. It is worth noting though that this is only a weekly snapshot and the Retail Sales report is considered a major release, so I am not expecting the claims data to have much of an impact on tomorrow's mortgage pricing.

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.