All's quiet on the economic report front. And while there was little economic report news during the first full week of January, the markets still had plenty of other news to digest. Read on for details:The only economic report to note last week was Thursday's Weekly Initial Jobless Claims Report. Initial Jobless Claims rose by 4,000 in the latest week to 371,000. This was above expectations and the highest number in a month. While the recently released Jobs Report for December showed that the labor market is continuing to improve, though at an anemic pace, it's also important that we see these weekly initial jobless claims numbers continue to decline.

Also in the news last week, Fannie Mae reported that its national housing survey showed that 43% of those consumers polled feel that home prices will rise in 2013. However, 20% said that their financial situations will deteriorate this year due to the debt ceiling worries and the rise in taxes. And in news overseas, European Central Bank President Mario Draghi said that he sees further risks to the region's economic outlook.

So what does this mean for home loan rates? Stocks did reach five-year highs last week--at the expense of Bonds and home loan rates--after the Fiscal Cliff deal was reached and investors felt that the pace of economic growth would increase due to the deal passing. However, uncertainty both here at home (due to the debt ceiling worries) and overseas (due to the continuing debt crisis in Europe) means that investors will likely continue to see our Bond market as a safe haven for their money. This could ultimately benefit Bonds--and home loan rates, which are tied to Mortgage Bonds--in the process.

The bottom line is that home loan rates remain near historic lows, meaning now is a great time to consider a home purchase or refinance. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

After last week's quiet economic report calendar, this week's calendar heats up.

• Retail Saleswill be released on Tuesday and investors will look to see if consumers opened their wallets during the holiday shopping season.
• We'll get a double dose of inflation news this week, with the wholesale-measuring Producer Price Index on Tuesday and the Consumer Price Index on Wednesday.
• Housing Startsand Building Permits will be reported on Thursday along with Weekly Initial Jobless Claims.
• We'll also see a double dose of manufacturing news, with the Empire State Index on Tuesday and the Philly Fed Index released on Thursday.
• To close out the week, the Consumer Sentiment Report will be released on Friday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond that home loan rates are based on.

When you see these Bond prices moving higher, it means home loan rates are improving -- and when they are moving lower, home loan rates are getting worse.

To go one step further -- a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

Bonds and home loan rates worsened last week as Stocks hit five-year highs. But home loan rates remain near historic lows and I'll be watching closely to see what happens this week.

As your mortgage professional, I am keeping you updated on the economic events that impact interest rates and how they may affect you.