There is nothing in terms of economic indicators for investors to chew-on this morning -- so trading action in the stock market will likely be the biggest determinant of interest rate trend trajectory.  Higher stock prices tend to drag mortgage interest rates higher -- while lower stock prices are generally supportive of steady to perhaps fractionally lower rates. 

Stocks opened sharply higher in the day's early trading on hopes that President-elect Obama's plans for the biggest investment in the country's infrastructure (highways, schools, government buildings, alternative power facilities) since the 1950's will help avert a deeper slump in the economy.  Optimism that automakers may receive an "11^th hour" reprieve from Congress added to the positive tone in the stock market at the start of the day.  The general sense starting to develop among investors, particularly stock investors, is that the people in charge are at least trying to do the right thing.  A government with a plan in a crisis is almost always far preferable to a government in a crisis with no plan.

I think it is worth noting that James Lockhart, the director of the Federal Housing Finance Agency, the government regulator for Fannie Mae and Freddie Mac, went out of his way in a interview on CNBC this morning to point out that while the government is taking concrete steps to shore up the housing market and reduce mortgage interest rates, there is no set target for how much borrowing costs should be.  The "so what" factor here is that mortgage interest rates will move to levels market participants, those with actual "skin-in-the-game" believe appropriate - not to levels an unnamed "source" whispers into the ear of the media.  I'm not suggesting it wasn't nice to have the media talking up the mortgage business for a change - I just think those that are expecting the government will target and achieve a given note rate (say 4.5%) under fair and open market conditions (not a market influenced by a special and specific government bond program) run a high risk of being disappointed.

Today's conforming 30 year fixed rate is at 5.50%.