By James Brooks

The bond market is currently down 7/32 (2.48%) we should see an increase of .125 of a discount point.

The Institute for Supply Management’s (ISM) manufacturing index for December was today’s only relevant data, but it was an important release. It showed a reading of 54.7 that exceeded forecasts (53.6) and November’s reading (53.2). This means that manufacturer sentiment was stronger than expected and rose from November’s level. Because that is a sign of strength in the manufacturing sector, it is considered bad news for bonds and mortgage rates.

The rest of the week brings us the release of three more monthly economic reports that we will be watching, including the single most influential monthly release. In addition to these reports, we also will get the minutes from the last FOMC meeting that have the potential to impact the bond market and quite possibly mortgage rates.

Tomorrow has two of those items, beginning with the ADP Employment report at 8:15 AM ET, which has the potential to cause some movement in the markets if it shows much stronger or weaker numbers. This report tracks changes in private-sector jobs of the company's clients that use them for payroll processing. While it does draw attention, it is my opinion that it is overrated and is not a true reflection of the broader employment picture. It also is not very accurate in predicting results of the monthly government report that follows a couple days later. Still, because we sometimes see a noticeable reaction to the report, it is on our calendar. Forecasts are calling for an increase of 170,000 new payrolls. Good news for mortgage rates would be a much smaller increase in payrolls.

Also being posted tomorrow is the release of the minutes from the last FOMC meeting. They will give market participants insight to the Fed's thinking and concerns regarding the economy, inflation and monetary policy. It is one of those pieces of information that may cause a great deal of volatility in the markets or be a non-factor, depending on what they show. They will be released at 2:00 PM ET, so they won't affect the markets or mortgage rates until afternoon hours. The last FOMC meeting was followed by revised Fed forecasts and a press conference by Fed Chair Janet Yellen, so the possibility of seeing something unexpected is minimal. Still, market participants will be looking for any tidbits about the decision to raise key short-term interest rates and when the next move may be made.

Overall, Friday is the key day of the week with the almighty Employment report being posted, but as expected, today was active also. The least active day will likely end up being Thursday. Please keep an eye on the markets and maintain contact with your mortgage professional if still floating an interest rate as a couple of this week's events have the potential to cause severe market volatility.

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.