By James Brooks

The bond market is down 6/32 (2.35%), whih should increase today's mortgage rates by .125 of a discount point.

The bond market improved after the FOMC minutes were posted yesterday afternoon. They didn’t reveal a significant surprise, but did seem to hint at a slower unraveling of the mortgage bonds they hold on their balance sheet. The concern is that once the Fed starts selling holdings they previously purchased to help boost economic growth, there will be a lack of buyers to prevent yields from rising. Since mortgage rates tend to track bond yields, this would be bad news. The minutes seem to ease concerns that they would be selling the mortgage bonds at a rapid pace. That sigh of relief allowed bond prices to move higher late yesterday, pushing yields and mortgage pricing lower.

Today’s only relevant economic data was last week’s unemployment figures at 8:30 AM ET. They showed that 234,000 new claims for unemployment benefits were made last week. This was lower than the 245,000 that was expected and a sizable drop from the previous week’s revised total of 259,000 initial claims. The smaller number is bad news for bonds and mortgage rates because declining initial filings indicates the employment sector may be strengthening. Fortunately, the impact on today’s trading has been fairly minimal since this is only a weekly snapshot.

The biggest news of the week will come early tomorrow morning when the Labor Department posts March's Employment report, revealing the U.S. unemployment rate and the number of jobs added or lost during the month. This is an extremely important report to the financial and mortgage markets. It is expected to show that the unemployment rate remained at 4.7% and that approximately 178,000 payrolls were added to the economy during the month while earnings rose 0.3%. A higher unemployment rate and a much smaller than expected payroll number would be good news for bonds and could likely push mortgage rates lower because it would indicate weaker than thought conditions in the employment sector of the economy.

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.