This week is quite busy with six economic reports along with other events that are relevant to bond trading and mortgage rates. In addition to those six reports, there is also a two-day FOMC meeting and a couple of Treasury auctions that have the potential to affect bond trading enough to slightly move rates. There is nothing of importance set for release tomorrow, but we still should see some movements in the markets due to this weekend’s weather-related news and expected volatility in stocks. The week's calendar kicks off Tuesday with January's Consumer Confidence Index (CCI) at 10:00 AM ET. This report is considered to be of moderate importance to the bond market and therefore can move mortgage rates if it shows any surprises. It is an indicator of consumer sentiment, which is important because waning confidence in their own financial situations usually means that consumers are less willing to make large purchases in the near future. Since consumer spending makes up over two-thirds of the U.S. economy, market participants are very attentive to related data. Analysts are expecting to see a small rise from December's reading, indicating consumer confidence was a little stronger than last month. A reading much smaller than the expected 96.8 would be ideal for the bond market and mortgage rates. A higher reading than forecasts would hint that consumers are more likely to spend in the immediate future, fueling economic growth and possibly pushing mortgage pricing higher Tuesday. December's New Home Sales will be released late Wednesday morning. It is considered to be the sister release to last week's Existing Home Sales, giving us a small snapshot of housing sector strength. It tracks a much smaller portion of home sales than last week's report did and is forecasted to show an increase in sales of newly constructed homes. However, this data is not important enough to heavily influence mortgage pricing unless it varies greatly from forecasts. This year's first FOMC meeting that begins Tuesday will adjourn Wednesday at 2:00 PM ET. There was a decent chance of this meeting yielding another quarter point increase to key short-term interest rates before the recent sell-off in stocks and oil costs. However, I believe the significant selling in stocks may alter the Fed’s monetary policy plans, at least temporarily. A rate hike is still possible though, so we need to be prepared in case it does happen. Afternoon volatility in the markets Wednesday is a strong possibility following the post-meeting statement release. Thursday’s only relevant monthly report is December's Durable Goods Orders at 8:30 AM ET. It helps us measure manufacturing strength by tracking new orders at U.S. factories for products that are expected to last three or more years. These are also known as big-ticket items and include things such appliances, electronics and airplanes. The data is known to be quite volatile from month-to-month, but is currently expected to show a decline in orders of approximately 0.5%. A large drop in orders would be considered good news for bonds and mortgage rates. Even though this an important report, a slight variance likely will have little impact on Thursday's mortgage pricing because of the large swings that are common in the data. Bond traders would prefer to see a large decline that would indicate weakness in the manufacturing sector. Friday has the remaining three reports, starting with what is arguably the single most important economic report that we see regularly. This would be the initial quarterly Gross Domestic Product (GDP) reading. Friday's release is the first of three we will get for the 4th quarter. This data is so important because it is considered to be the best measurement of economic activity. The GDP itself is the total sum of all goods and services produced in the United States. Its results usually have a major impact on the financial markets and can cause significant changes in mortgage rates. This initial reading will be followed by two revisions, each released approximately one month apart. Last quarter's first reading, which usually carries the most significance, is expected to show the economy grew at an annual rate of only 0.9%. A noticeably weaker reading would be great news for the bond market, questioning the strength of our economy. That would likely fuel stock selling and a rally in bonds that should push mortgage rates lower Friday morning. However, a larger than expected increase, indicating the economy was stronger than thought, will probably fuel bond selling and lead to higher mortgage rates. The second release of the day will be the 4th Quarter Employment Cost Index (ECI), also at 8:30 AM ET. This index measures employer costs for employee wages and benefits, giving us an indication of the threat of wage inflation. If wages are rising, consumers have more money to spend and businesses usually need to charge more for their products and services. The report is considered moderately important and usually has more of an impact on the bond market than the stock markets. Current forecasts are showing an increase of 0.6%. A lower than expected reading would be favorable to bonds and mortgage rates Friday, but unless we see a large variance from forecasts and no surprises in the GDP, I am not expecting this report to have much of an influence on rates. The final economic report of the week is the revised reading to the University of Michigan's Index of Consumer Sentiment just before 10:00 AM ET Friday. This index is another measurement of consumer confidence that is thought to indicate consumer willingness to spend. I don't see this data having much of an influence on the markets or mortgage rates unless we see a large revision from the preliminary reading of 92.6. Also worth noting, there are two relatively important Treasury auctions for the markets to digest. The Fed will auction 5-year and 7-year Treasury Notes Wednesday and Thursday respectively. If the sales are met with a strong demand from investors, the broader bond market may improve during afternoon hours. If they draw a lackluster interest, they could lead to bond selling and higher mortgage rates mid-afternoon Wednesday and/or Thursday. Overall, Wednesday is a pretty safe bet as most important for mortgage rates but Friday is also a key day. Wednesday has the FOMC meeting adjournment that is always big news and Friday's GDP report is highly important also. And stocks can affect bond trading and mortgage pricing any day, as we have seen with all the recent volatility. With all of this scheduled, there is a decent chance of seeing a very active week in mortgage rates this week.