This past week saw a mixed bag of economic news that had mortgage rates in a quandary. Positive reports on new and existing home sales along with signs of a slowing in the rate of home price decline signaled a possible recovery in the housing market that put upward pressure on rates. These reports were tempered, however, by the Mortgage Bankers Association’s release of its weekly mortgage application index which fell to 960.6 lead by a 21.9% drop in refinance applications. Purchase applications, on the other hand, fell by only .6%. Consumer confidence surged by more than analysts had expected leading many to believe consumers may be willing to open their pocket books in the coming months. Consumer spending will be crucial if we the second quarter is top the first quarter’s dismal GDP which fell by a whopping 6.1% in the first quarter. Economists had expected a drop of 4.7% All of these mixed signals have combined to leave mortgage rates basically unchanged since last week despite daily volatility. The thirty year fixed-rate stands right at 4.875% and the fifteen year stands at 4.375%. We have one new wild card in the mix as the threat of a global pandemic from the swine flu has markets world-wide somewhat rattled. If the outbreak becomes more widespread and serious in the coming days, this could hurt global markets and give a boost to bonds and help ease rates further.