The bond market is improving this morning on a worse than expected initial jobless claims report for the week ended 1/30/10.  The market was expecting a reduction of approx 15,000. The actual # was an increase of 8,000.  We believe it is important to be very vigilant in floating loans right now.  For our pipeline of customers with unlocked loans, we are watching to see if any further improvement develops today but will most likely not recommend floating overnight.   While it is possible that a dismal number in tomorrow's January Non Farm Payroll report could cause rates to inch slightly lower, it is also very possible that a better than expected number will cause rates to move up.  The overriding factor which is larger than any economic statistic is that unless the Federal Reserve changes course, they will stop purchasing mortgages in March.  Analysts expect the Fed's purchases over the coming weeks to taper out as they strech their remaining budget for mortgage purchases into the end of March and allow room for the private sector to move back into the market.  I have yet to find an analyst who believes the private sector is going to purchase mortgage pools at a cost that would support interest rates of 4.875% with 0 points on a 30 year fixed rate.