This holiday-shortened week has only two monthly economic reports scheduled for release that are relevant to mortgage rates in addition to a couple of potentially influential Treasury auctions. The markets will close early Tuesday ahead of the Christmas holiday and reopen Thursday morning. The first event of the week will be November's New Home Sales data at 10:00 AM ET tomorrow. This report gives us a measurement of housing sector strength and mortgage credit demand. It is the sister report of last week's Existing Home Sales report but covers a much smaller portion of the housing market and carries less significance. A weakening housing sector is considered good news for the bond market and mortgage rates because broader economic growth is less likely in the immediate future if housing is soft. Since bonds tend to thrive in weaker economic conditions, a large decline in sales would be considered favorable for bond prices and mortgage rates. Current forecasts are calling for an increase in sales of newly constructed homes. November's Durable Goods Orders at 8:30 AM ET is the week’s other monthly release. This data gives us an important measurement of manufacturing sector strength by tracking orders for big-ticket items or products that are expected to last at least three years such as appliances, airplanes and electronics. Analysts are expecting the report to show a 1.4% rise in new orders. A decline in new orders would indicate that the manufacturing sector was weaker than many had thought. This would be good news for the bond market and should help push mortgage rates lower. However, a large jump in orders could lead to mortgage rates moving higher early Tuesday morning. This data is known to be quite volatile from month-to-month though, so it is not unusual to see large headline numbers from this report. The Treasury auctions that we will be watching will take place Tuesday and Thursday. 5-year Notes will be sold Tuesday followed by a 7-year Note auction Thursday. If these sales are met with a strong demand, bond prices may rise enough to lead to improvements in mortgage rates shortly after the results are posted. But a lackluster demand from investors may create bond selling and upward revisions to mortgage rates Wednesday and/or Thursday. Results will be announced at 10:00 AM Tuesday and 1:00 PM ET Thursday. That’s all we have scheduled this week. Stocks will trade until 1:00 PM ET Tuesday while bonds will close at 2:00 PM ET. With nothing of importance scheduled for Thursday or Friday, we can expect many traders to stay home for the extended holiday. In situations like this, trading volume in the markets is often light and unreliable. What is normally not relevant can have an impact on days like that since there are fewer traders and fewer orders placed. That causes more noticeable moves than fully staffed days. However, the impact on mortgage rates is not worth worrying about unless a major piece of news hits the wires. Overall, Tuesday is the most important day of the week because the Durable Goods report is considered to be important to the markets and there is a short day for them to react to its results. The calmest day will likely be Friday unless something unexpected happens.