Early expectations were for a rise of 0.5% after last month’s 1.7% rise, which was now revised downwards to 1.6%. This is not the first housing figure that disappoints recently.
EUR/USD and USD/JPY are dropping in a “risk off” reaction.
Last week, new and existing home sales didn’t exactly meet expectations. Existing home sales stood on an annualized figure of 4.94 million, lower than 5.09 million that was predicted. New home sales dropped to a level of 369K, short of 387K that was predicted, but the figure for the previous month was revised to the upside.
Is the housing sector taking a break after an impressive recovery?
Earlier, durable goods orders came out better than predicted: the headline number leaped by 4.6%, beating predictions for a rise of 1.8%. The core figure rose by 1.3%, also beyond predictions of a rise of 0.8%.
The initial market reaction shows that markets haven’t fully returned to normal: a normal reaction would have been a weaker dollar across the board, but instead we get a stronger dollar against everybody apart from the yen. The yen and the dollar are still safe haven currencies.
Further reading: EUR/USD Near Confluence Line – Break or Bounce?Get the 5 most predictable currency pairs