Mortgage rates gave back yesterday's gains this morning following a stronger-than-expected employment report from ADP.  While this is not the week's biggest jobs report, investors view it as one of several early indicators of the official Employment Situation (the big jobs report that comes out tomorrow morning).   In general, stronger economic data (i.e. more job growth) tends to push rates higher and vice versa.

In the bigger picture, today's move higher in rates will scarcely be detectable for most borrowers.  In nearly every case, today's rate quote would be the same as yesterday's with the possible exception of slightly higher upfront costs today.  When it comes to "note rates" (the actual interest rate applied to your mortgage balance, without regard for the upfront costs), we're still sideways near the best levels of the year.  

Does today's reaction to the ADP data suggest markets are prepared to react to tomorrow's bigger jobs report?  Absolutely!  Markets are always READY to react to the Employment Situation, but the numbers will have to fall far from the median forecast.  Stronger numbers suggest higher rates, but a big miss could be enough for rates to challenge recent lows.  Either way, tomorrow is the riskiest day of the week, for better or worse.