The US dollar started the week on the back foot, extending some of the losses it suffered from last week. Yet with the highest level of new home sales in a decade, the greenback did not remain unfazed.
A leap to 685K annualized sales of new units in October certainly beat expectations of only 627K. Economic growth and expansion in the housing sector go hand in hand. Every sale of a new home has a wider impact than a sale of an existing, second-hand home.
The dollar previously tumbled on growing concern from the Fed regarding inflation. Yellen’s comments about lower inflation not being transitory were followed by the meeting minutes, which were quite dovish.
Here is the main currency reaction:
- USD/JPY had already dipped under 111 and has now bounced back.
- EUR/USD extended its gains to reach 1.1960 before sliding now back to 1.1940.
- GBP/USD had also made it to the highest in 7 weeks and now slipped back to 1.3350.
- AUD/USD was on a recovery path, reconquering 0.7610 but stalled.
- USD/CAD stabilized as well, around 1.2730.
The week after Thanksgiving also features quite a few speeches from Fed officials and also an update on US GDP.
And, markets are also looking to cryptocurrencies, with bitcoin setting its sights on $10K.