In June, US new home sales rose by 11% to a total number of 384 000, significantly above the consensus estimate of 352 000. Also the previous outcome was upwardly revised from 342 000 to 346 000. The regional details show significant increases in the Northeast, Midwest and West, while new home sales fell in the South. Months’ supply dropped significantly (from 10.2 to 8.8) in June and the total number of homes for sale fell to its lowest level in more than 11 years. Median prices dropped by 5.8% M/M, while mean prices stayed flat on a monthly basis. In June, new home sales rose for the third consecutive month and also homes for sale fell significantly, providing further evidence that the US housing market is stabilizing.
EMU: Lending to corporations slows sharply
In June, M3 money supply growth slowed from 3.7% Y/Y to 3.5% Y/Y, exactly in line with expectations. The three-month moving average fell below the ECB’s reference value of 4.5% Y/Y for the first time since 2001. Looking at the counterparts, total credit growth rose slightly from 3.9% Y/Y to 4.2% Y/Y due to a sharp rise in growth to governments, while annual loan growth to the private sector slowed from 1.8% Y/Y to 1.5 % Y/Y. Loans to households grew slightly (0.2% Y/Y from -0.2% Y/Y), while loans to non-financials slowed significantly from 4.4% Y/Y to 2.8% Y/Y. The data indicate that financing constraints to corporations still pose a threat to the euro area’s economic recovery.
