Slightly better than expected new home sales: they rise 2% to 512K in February, better than 510K expected. In addition, there is a small upwards revision from 494K to 502K for the month of January, easing the shortfall seen at the time.
The US dollar is slightly stronger in the aftermath of the publication, but nothing earth shattering.
Sales of new homes in the US were expected to rise 3.2% to an annualized level of 510K, from a disappointing 494K beforehand (before revisions). Sales of new homes ignite a lot of collateral economic activity. In addition, they are correlated with the general growth situation.
The dollar was looking quite solid on additional hawkish comments from Fed members, contrasting the extremely dovish Fed decision last week. EUR/USD was pressured under 1.12, GBP/USD under 1.4150 and USD/JPY got closer to 113.
James Bullard, president of the St. Louis Fed, said that rates could rise in April, echoing a few of his colleagues, some of them not exactly known hawks. Words from Williams, Lacker and Loickhart sounded upbeat about the economy and about the meeting in April.
In the April meeting there is no press conference nor fresh forecasts. According to the implied probability in bond markets, the chances still remain slim. However, the chances for a hike in June haven risen quite nicely and are nearly at 50-50, the pre-Fed decision.
