USD Rallies After US Home Prices Jump More Than Expected In May
THE TAKEAWAY: [U.S. home prices advance for fourth month] > [Housing market stabilizing; prices boosted by low borrowing costs and tight supply] > [USDCAD bullish]
U.S. home prices rose in May for the fourth consecutive month, signaling some stabilization in the property market. According to a report released today by the Federal Housing Finance Agency (FHFA), housing prices climbed 0.8 percent on a seasonally adjusted basis in May from the previous month. This follows an increase in April of 0.7 percent, which was revised from 0.8 percent originally reported.The consensus estimate of 17 economists surveyed by Bloomberg News had called for a month-on-month price rise of 0.4 percent in May.
Job gains, a tight supply of homes for sale and mortgage affordability through record-low borrowing costs have boosted housing prices.
USDCAD 1-minute Chart: July 24, 2012
Chart created using Market Scope – Prepared by Tzu-Wen Chen
In the minutes after data release, the U.S. dollar strengthened against its major currency peers. The greenback rallied against the loonie, and at the time this report was written, the USDCAD pair was trading higher at C$1.0191.
--- Written by Tzu-Wen Chen, DailyFX Research