Daily Market Update 12/17/12

Mortgage rates held steady Monday as weaker than expected economic data was offset by increased optimism that a deal will be reached to avoid the "fiscal cliff".  This morning, the Empire State Index declined to -8.1, well below the consensus forecast of +1.0.  Readings below zero indicate contraction in manufacturing in the region.  Results from today's 2-year Treasury auction will be released at 1:00 PM.