Investing.com – U.S. existing home sales unexpectedly fell to a one-year low in August, dampening optimism over the health of the housing market, according to a report released on Wednesday by the National Association of Realtors (NAR).
The industry data showed that home resales unexpectedly decreased by 1.7% in August to a seasonally adjusted 5.35 million units from 5.44 million units in the previous month. That was the lowest reading since the same period in 2016.
The consensus forecast was for a 0.3% increase to 5.44 million units in August.
The data helps to gauge the strength of the U.S. housing market and is considered to be a key indicator of overall economic strength.
The report indicated that strained supply levels continued to subdue overall activity, while gains in the Northeast and Midwest were outpaced by declines in the South and West.
NAR chief economist Lawrence Yun noted that, despite the slump, there was still a solid level of demand for buying a home.
“Steady employment gains, slowly rising incomes and lower mortgage rates generated sustained buyer interest all summer long, but unfortunately, not more home sales," he said.
“What's ailing the housing market and continues to weigh on overall sales is the inadequate levels of available inventory and the upward pressure it's putting on prices in several parts of the country,” Yun explained.
“Sales have been unable to break out because there are simply not enough homes for sale,” this expert added.
After the report, EUR/USD traded at 1.1996 compared to 1.1998 before the release, GBP/USD exchanged hands at 1.351, compared to 1.3552 before the data, while USD/JPY traded at 111.47 compared to 111.46 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, traded at 91.54 compared to 91.52 earlier.
Meanwhile, U.S. stock markets traded flat after the open. The Dow Jones Industrial Average slipped 2 points, or 0.01%, the S&P 500 was unchanged, and the tech-heavy Nasdaq Composite dropped 2 points, or 0.03%.
Elsewhere, in the commodities market, gold futures traded at $1,315.08 a troy ounce, compared to $1,315.87 ahead of the data, while U.S. crude oil changed hands at $50.55, compared to $50.48 earlier.