Existing Home Sales in the US were better than expected, and better than last month. This adds to last week’s housing data that also gave some hope. Is there a house at the end of the tunnel?
American Existing Home Sales in the US stood on 4.72 million in February. Early expectations were for a fall from 4.49 million to 4.45 million. Not only did Existing Home Sales exceed early expectations, they also exceeded last month’s figure.
Last week, I was wondering if American housing reached the bottom. This came after Building Permits rose by 3% to 547K (annually adjusted). This initial first surprise was followed by more good news: Housing Starts leaped by 22% to 583K, the first rise in 8 months, and the highest levels since November.
Today’s good figure strengthens the notion that American housing has its worst days behind it. On Wednesday, the complementary figure of New Home Sales will be published in the US (Forex Weekly Outlook). New Home Sales are expected to stay similar to last month (305K) and to show a figure of 309K. With the Existing Home Sales being so positive, I wouldn’t be surprised to see a better figure also in the New Home Sales.
This housing data comes as Timothy Geithener unfolds the Toxic Assets plan. I still think that the Toxic Assets Plan is Toxic Dollar in the short term. But in the long term, I am optimistic that this plan will not only keep American housing above the bottom, but also help it show a healthy growth and help revive the American economy.
Is there a non-toxic house at the end of the tunnel? What do you think?Get the 5 most predictable currency pairs