NAHB Housing Market Index Declines As Mortgage Rates Rise

Key Insights

• NAHB Housing Market Index decreased from 56 in July to 50 in August. 
• Business Inventories remained unchanged on a month-over-month basis in June. 
• SP500 tested session lows as traders reacted to the weaker-than-expected NAHB Housing Market Index report.

On August 15, the National Association of Home Builders released NAHB Housing Market Index report for August. The report indicated that NAHB Housing Market Index declined from 56 in July to 50 in August, compared to analyst consensus of 56.

NAHB commented: “After steadily rising for seven consecutive months, builder confidence retreated in August as rising mortgage rates nearing 7% (per Freddie Mac) and stubbornly high shelter inflation have further eroded housing affordability and put a damper on consumer demand.”

Today, traders also had a chance to take a look at the Business Inventories report for June. The report showed that Business Inventories remained unchanged on a month-over-month basis, while analysts expected that they would grow by 0.1%.

U.S. Dollar Index settled near the 103.00 level after the release of the report. The U.S. dollar is under pressure against a broad basket of currencies as traders take some profits off the table near multi-week highs.

Gold traded near the $1905 level amid a broad pullback in commodity markets. The market sentiment for commodities is bearish today, and the housing market report did not have any material impact on gold price dynamics.

SP500 tested session lows near the 4450 level after the release of the weaker-than-expected housing data. Traders are worried that rising interest rates put too much pressure on the economy.

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