Housing Remains in a Soft Patch

Wells Fargo Research Team Wells Fargo

U.S. Review

Housing Remains in a Soft Patch

Housing starts rose 9.2% in August. Volatile multifamily starts increased 29.3%, while single-family units rose 1.9%. Building permits dropped 5.7% during the month.
Existing home sales were unchanged at a 5.34-million unit annual pace in August. The total inventory of available homes was also unchanged at 1.92 million homes. The median price of an existing home rose 4.6% year-over-year.
The Leading Economic Index climbed 0.4% in August, further evidence that economic growth should remain solid in the second half of 2018.

Global Review

Firmer Global Growth to Be a Gradual Process

This week’s global data were mixed. The Eurozone services PMI rose in September but the manufacturing PMI fell, while in the U.K., August CPI inflation and retail sales were both firmer over the month. Signs of global growth improvement remain gradual, and we still look for ECB and Bank of England policy rates to remain steady for some time.
This week saw some central bank monetary policy announcements, but limited action. Norway’s central bank hiked interest rates in response to firmer growth and inflation. The Swiss central bank kept interest rates in negative territory, while the Bank of Japan held monetary policy unchanged.

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Wells Fargo Research Team

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EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

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Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

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XRP rally extends as modest ETF inflows support recovery

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