As we warned in yesterday’s ‘rate update’ there is plenty of economic data out this week.

This morning the National Association of Realtors announced that pending home sales rose for the 6th straight month in June.  Pending home sales rose 3.2% in June which was more than analysts had expected.  This is good news for the housing market and the economy as a whole.

In a separate report the Institute for Supply Management reported that manufacturing activity in the US grew at a faster clip than analysts had expected.

It wasn’t all good news though.  The Commerce Department reported that construction spending unexpectedly declined in July.

Despite 2 out of the 3 economic reports coming out better than expected stocks are trading lower this morning which is helping support mortgage-backed bond prices.

Current outlook: floating bias