Mortgage rates stabilized today, after moving higher somewhat quickly following several strong economic reports on Friday. If you'd like to revisit the relationship between economic data and rates, we discussed it in greater detail in yesterday's coverage.
Interestingly enough, today brought the week's most important economic report--ISM Non-Manufacturing. This is the counterpart to the ISM Manufacturing report that caused problems for rates on Friday. Today's non-manufacturing version came in weaker than expected, so from an economic data standpoint, it's no surprise to see rates improving.
Notably, rates were set to improve, somewhat, even before the ISM data came out. That suggests the broader bond market (which underlies mortgage rate momentum) is settling into a "wait and see" stance from which it can digest all the incoming economic data that it missed during the government shutdown. By mid-March, traders will be fully caught up on the data and will also get another major update from the Federal Reserve. As such, that would be the time frame where we'd expect to see rates making bigger moves in the bigger picture.