A big disappointment from the US housing sector: an annual level of 384K new homes were sold in the month of March. The number of sales of new homes was expected to rise to an annual level of 455K in March from 440K in February (before revisions). Sales of new homes trigger a wide range of economic activity.
Before the publication, EUR/USD was trading at 1.3827, GBP/USD at 1.6785, USD/JPY around 102.35 and USD/CAD traded above 1.1040. The dollar is lower after the release..
Can the weak New Home Sales figure be blamed on the cold spell in early March? This is not a fully “clean” month – the weather improved only in mid March. Or, does this figure show that there is no spring bounce? The jury remains out and the US economy probably still has a long road ahead.
Earlier, Markit’s Flash manufacturing PMI for the services sector ticked down from 55.5 to 55.4 in April, below expectations for a rise to 56.2 points. The more important PMIs in the US come from ISM.
Yesterday, sales of existing homes came out as expected.
Is the US really rebounding in the spring? Economic figures look good, but paint a picture of a return to normal after the winter cold, but not of a new move higher.
The Canadian dollar is on the back foot after weak retail sales numbers. While the recent figures rose as expected, they came on top of downside revisions to previous data.
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