US Dollar Dips on Fifth Consecutive Decline in Pending Home Sales
- US pending home sales declines for the fifth consecutive month
- US Dollar traders remain focused on disputed start of the Fed taper
- USD/JPY falls slightly
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US pending home sales declined for the fifth consecutive month in October, sending the US Dollar temporarily lower against the Japanese Yen.
The number of contracts signed for the purchase of single family homes fell 0.6% from the previous month, disappointing expectations for a 1.0% rise in pending home sales, but better than the revised 4.6% decline in pending home sales in September. Pending home sales declined 2.2% from October 2012, according to the National Association of Realtors.
The US Dollar continues to trade around speculation of when the Fed will begin to taper its monthly asset purchases. In the minutes from the October FOMC meeting, the Fed said that it is likely to taper QE in the coming months on better data. Therefore, worse than expected data, like a decline in pending home sales, may add to expectations for the Fed to not taper in December.
That is why the US Dollar fell about 10 pips after the home sales release. However, the losses were relatively light and quickly reversed because it is not a major economic release. A previous 5-month high at 101.53 may now provide support for USD/JPY trading.
USD/JPY 1-Minute: November 25, 2013
Chart created by Benjamin Spier using Marketscope 2.0
-- Written by Benjamin Spier, DailyFX Research. Feedback can be sent to email@example.com .
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