This week saw mortgage rates revisit near record all time lows as the market dealt with concerns of a European debt default. This time it was Italy in the crosshairs as Italian Prime Minister Berlusconi agreed to resign. The market is likely to look favorably to a resolution in the Italian drama, but some analysts still have significant concerns over Italy’s solvency even in light of new austerity measures (reductions in spending and debt) and a new government.

Since the bond market is closed today in honor of Veterans Day, we’ll have to wait until Monday to see how mortgage rates will react to the latest developments in Italy and any new news that may come out this weekend. There’s likely to be volatility next week with mortgage rates, so speaking with us regarding rate locks isn’t a bad idea in case you are on the fence.

Consumer Sentiment Data Released

This morning, Consumer Sentiment data came in higher than expected. Consumer Sentiment, released by Thomson Reuters and the University of Michigan, helps market analysts understand consumer attitudes towards the business climate, personal finance, and spending. Like any market data, if it is good for the economy as a whole, that will tend to push mortgage rates up while negative news is good for helping mortgage rates go lower.

Mortgage Rate Outlook for Next Week

Mortgage rates may move on a dime on any news relating to the Eurozone debt crisis and specifically on any news related to Italy. In fact, there’s a high likelihood that more news on the Italian front will hit the wires this weekend, affecting mortgage rates on the open on Monday. Good news on the Italian front will likely result in mortgage rates increasing. Bad news will likely result in lower mortgage rates.

Next week in the US, Congressional Super-Committee will be reaching a deal to cut spending by a minimum of $1.2 trillion. If they fail to do so, this would trigger automatic cuts to Medicaid and defense spending.

There is also some significant economy data being released next week that may affect mortgage rates. Next week will mark the release of data for Retail Sales, PPI Index, Consumer Price Index, Jobless Claims and Housing Starts.