Weekly Economic & Financial Commentary: More strong housing numbers

U.S. Review

More strong housing numbers

• Existing home sales rose 2.4% to a 6.0-million unit annual pace. The surge in sales further depleted inventories and pushed prices sharply higher.
• The IHS Markit Purchasing Managers’ survey noted that manufacturing conditions improved in September.
• New home sales soared 4.8% to a 1.011-million unit pace, marking the strongest sales pace since September 2006.
• Durable goods orders were stronger than the 0.4% headline gain suggests. Core nondefense capital goods orders rose 1.8%, and are up at a 22.7% pace over the past three months.

Global Review

Eurozone recovery threatened by surging COVID cases

• Surging new covid-19 cases across europe have threatened the continent’s economic recovery. Daily new cases are now above the peak seen in march/april, although this does not account for differences in testing.
• Against this backdrop, eurozone september pmi indices were closely scrutinized by market participants this week. The services pmi showed further weakness, falling into contraction territory at 47.6.
• Elsewhere, the bank of mexico cut its overnight interbank interest rate 25 bps to 4.25%. most forecasters in the bloomberg survey expected the cut.

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