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U.S. pending home sales rise 0.9% in May to hit highest since 2006

Published 06/29/2015, 10:04 AM
Updated 06/29/2015, 10:04 AM
© Reuters. U.S. pending home sales rise to 9-year high in May

Investing.com - Pending home sales in the U.S. rose to the highest level since 2006 in May, underlining optimism over the health of the housing sector and supporting the case for a U.S. interest rate hike this year, industry data showed on Monday.

In a report, the National Association of Realtors said its pending home sales index increased by a seasonally adjusted 0.9% last month, compared to expectations for a gain of 1.2%.

Pending home sales in April rose by 2.7%, whose figure was revised down from a previously reported gain of 3.4%.

Year-on-year, pending home sales rose at annualized rate of 8.3% in May, below forecasts for an increase of 11.6% and following a gain of 13.4% in April.

Lawrence Yun, NAR chief economist, says the steady gains in contract activity each month this year highlight the fact that buyer demand is strong.

"Realtors are saying foot traffic remains elevated this spring despite limited, and in some cases severe, inventory shortages in many metro areas," he said.

EUR/USD was trading at 1.1134 from around 1.1121 ahead of the release of the data, GBP/USD was at 1.5720 from 1.5721 earlier, while USD/JPY was at 122.87 from 122.92 earlier.

The US dollar index, which tracks the greenback against a basket of six major rivals, was at 95.66, compared to 95.74 ahead of the report.

Meanwhile, U.S. stock markets were lower after the open. The Dow 30 shed 0.8%, the S&P 500 dipped 0.75%, while the Nasdaq Composite fell 0.9%.

Elsewhere, in the commodities market, gold futures traded at $1,176.40 a troy ounce, compared to $1,175.30 ahead of the data, while crude oil traded at $58.65 a barrel from $58.63 earlier.

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