This week has only three pieces of economic data scheduled for release that have the potential to influence mortgage rates, none of which are considered to be key or highly important reports. All of them are set to be posted the middle days, so we could see the most movement in rates mid-week. We also need to watch stocks since we are still in corporate earnings season. There is nothing of importance scheduled for tomorrow, meaning we can look towards stocks to help determine bond and mortgage rate direction early in the week.
March's Housing Starts will start the week’s releases early Tuesday morning. This report tracks groundbreakings of new home construction, giving us a measurement of housing sector strength and future demand for mortgage credit. It is not considered to be highly important to the markets but does draw enough attention to influence trading if it reveals surprisingly strong or weak numbers. The report will be posted at 8:30 AM ET and is expected to show a small decline in starts from February to March. Good news for mortgage rates would be a sizable decline in starts that points toward housing sector weakness.
Next up is March's Existing Homes Sales numbers from the National Association of Realtors at 10:00 AM ET Wednesday. This report gives us an indication of housing sector strength and mortgage credit demand. It is considered to be moderately important to the markets, but can influence mortgage pricing if it shows a sizable variance from forecasts. Ideally, the bond market would like to see a drop in home resales because a soft housing sector makes broader economic growth more difficult. Analysts are expecting to see an increase in sales between February and March. The larger the increase, the worse the news it is for bonds and mortgage rates.
The third and final monthly release will come from the Conference Board late Thursday morning when they post their Leading Economic Indicators (LEI) for March. This data attempts to predict economic activity over the next three to six months. It is also considered to be only a moderately important report, so at best we can expect to see a slight movement in rates as a result of this data. It is expected to show a 0.4% increase from February's reading, meaning it is predicting moderate growth in economic activity over the next several months. A decline would be considered good news for the bond market and could lead to slightly lower mortgage rates.
Overall, there is nothing scheduled this week that is expected to create much volatility or be a market mover. Chances are decent that we will see a fairly calm week for mortgage rates unless stocks make a significant move or something unexpected happens.