U.S. new home sales likely to have risen in October

The U.S. new home sales data for the month of October is set to be released tomorrow. According to a Wells Fargo research report, the new home sales are likely to have risen in the month. The housing market has been a marked soft spot in an otherwise strong economy. The softness here has become even more pronounced recently. For instance, a widely followed sentiment measure for homebuilders had recorded its largest monthly fall in almost five years in November.

Another released last week had shown that housing starts had rebounded in October, rising 1.5 percent after a 5.5 percent fall in the prior month. Financial markets tomorrow would digest two more reports on the state of the housing market when mortgage applications and new home sales both hit the wire.

“Mortgage applications have fallen in five out of the past six weeks and new home sales have fallen in five out of the past six months. Rising rates and inventory issues are the primary headwinds and it is not immediately clear that either is moving in the right direction”, stated Wells Fargo.

At 14:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was highly bullish at 125.836. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex