Mortgage investors gave this morning's March Personal Income and Spending data and the first-quarter Employment Cost Index figures nothing more than a passing glance. Both sets of numbers fell roughly inline with the majority of economists' expectations and therefore had already been priced into the market.


Mortgage investors' attention is keenly focused on the upcoming battle developing between the White House and congressional leaders as the clock tick downs on the mid-May deadline to raise the $14.3 trillion cap on government borrowing. Default, even if temporary, could have long-term adverse effects for Treasury debt sales - and by extension - the trend trajectory of mortgage interest rates.


Even if those in power reach an agreement to raise the debt ceiling -- but in the process choose to engage in another round of political brinkmanship that pushes the financial debate down to the wire - you can bet the upward pressure on mortgage interest rates will rise as both domestic and global market participants are forced to prepare for a potential debt default by the United States government. Most observers believe an accord will be reached -- but the timing of such an event is still in question.


The coming week will be a busy one with respect to potentially market moving economic reports. Things kick-off on Monday when the Institute of Supply Management releases their April manufacturing activity index at 10:00 a.m. ET. The Institute's April Service Sector Index will take center-stage on Wednesday morning at 10:00 a.m. ET and the grand finale will occur on Friday with the release of the April Nonfarm Payroll stats at 8:30 a.m. ET. All three major reports are currently expected to prove supportive of steady to perhaps fractionally lower mortgage interest rates.