Talking Points:
- USD Existing Home Sales for June reads +3.2% m/m vs +0.9% m/m estimate
- USDJPY surges higheron favorable US economic data.
- See the DailyFX Economic Calendar for event risk in the days ahead
The monthly change for June US Existing Home Sales came out at +3.2%, significantly beating the +0.9% estimate, according to economists polled by Bloomberg news. The prior reading came with a downward revision, dropping -0.5% to 4.5%. In addition to the percentage change, US Existing Home Sales read 5.49 million versus a 5.40 million estimate. A -300K downward revision dropped last month’s data from 5.35 million to 5.32 million.
The USDJPY pair experienced a slight surge after the data print. Overall, housing data for the US was strong for June causing immediate strength in the greenback, with little reaction from the downward revisions. USDJPY extended past a ¥123.84 resistance after 13:00 GMT on the back of the US housing market data. The pair was trading at ¥124.027 at the time of writing.
Market participants look to existing home sales data for an accurate assessment of housing market conditions in the US. The housing market is often a precursor to business cycle twists and considered an important indicator for the United States economy.
As of this morning, US House Price Index was largely in line with expectations, charting a +0.4% read. The data was accompanied by a +0.1% upward revision for last month. On a year-to-year basis, the May US FHFA monthly house price index increased +5.7%.
Economic risk for the housing market will continue on Friday, July 24 when June US New Home Sales data is released. Bloomberg News sees economists are conceding a -2.3% monthly read from last month’s figure.
--- Written by Christopher Vecchio, Currency Strategist and Yash Gandhi, DailyFX Research
To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com
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