NAHB Housing Market Index Beats Expectations As Mortgage Rates Fall

Key Insights

• NAHB Housing Market Index increased from 37 in December to 44 in January. 
• Mortgage rates decreased by more than 110 basis points since October. 
• The average price reduction remained at 6%. 

On January 17, the National Association of Home Builders released NAHB Housing Market Index report for January. The report indicated that NAHB Housing Market Index improved from 37 in December to 44 in January, compared to analyst consensus of 39.

The National Association of Home Builders commented: “Lower interest rates improved housing affordability conditions this past month, bringing some buyers back into the market after being sidelined in the fall by higher borrowing costs.”

Mortgage rates declined by more than 110 basis points since late October, providing material support to the housing market. Interestingly, NAHB noted that 31% of builders reduced home prices in January to boost sales.

U.S. Dollar Index pulled back from session highs after the release of the better-than-expected NAHB report. For the U.S. dollar, the strong Retail Sales report, which was released earlier, will likely remain the key catalyst for today’s trading session.

Gold remains under strong pressure as traders focus on stronger dollar and rising Treasury yields. Currently, gold is trying to settle below the support at $2015.

SP500 moved away from session lows, supported by the better-than-expected report. It should be noted that SP500 showed a negative reaction to the encouraging Retail Sales data as traders reduced their bets on a dovish Fed.

For a look at all of today’s economic events, check out our economic calendar.