- Pending Home Sales decreased by 22.2% compared to May 2022.
- High interest rates have put some pressure on housing market activity.
- NASDAQ tested session lows as traders remained focused on rising Treasury yields.
On June 29, the National Association of Realtors reported that Pending Home Sales declined by 2.7% month-over-month in May, compared to analyst consensus of -0.5%. On a year-over-year basis, Pending Home Sales decreased by 22.2%.
The National Association of Realtors commented: “Despite sluggish pending contract signings, the housing market is resilient with approximately three offers for each listing […] It is encouraging that homebuilders have ramped up production, but the supply from new construction takes time and remains insufficient.”
It remains to be seen whether housing data will have a material impact on market dynamics as traders may stay focused on the surprising growth of U.S. GDP.
Treasury yields are testing multi-month highs as bond traders bet on a more hawkish Fed. According to FedWatch Tool, the probability of two additional rate hikes has increased to 35.2%.
U.S. Dollar Index pulled back from session highs as traders reacted to the Pending Home Sales report. Traders took some profits off the table near weekly highs.
Gold moved back above the $1900 level. The weaker-than-expected Pending Home Sales show that high interest rates continue to put pressure on the housing market, although the Fed may still remain hawkish.
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