Forex Trading News – US Housing industry in a slump

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April was another slow month for housing in the US. Both housing starts and building permits unexpectedly declined for the second straight month.

The US Census Bureau’s latest release on the annualized number of new residential buildings that began construction during the previous month recorded a drop in housing starts from 0.59 million to 0.52 million, lower than the expected 0.58 million.

Housing starts in the South recorded a new two-year low.

The Bureau’s findings on building permits reported a decline from a revised 0.57 million down to 0.55 million, lower than expected.

On a year to year basis, compared to April 2010, residential construction was down 23.0 percent, the largest decline since October 2009.

Corporate results from Home Depot provided further evidence of a slump in housing after the top home improvement chain noted poor weather hurt the spring selling season and dampened its sales.

The data show a prolonged weakness in the housing sector.

Michael Woolfolk a senior currency strategist at BNY Mellon in New York said, “We’re still struggling to find the bottom here for the housing market. It does not bode well for construction in the near term, and there’s a good deal of overhang in terms of inventory.”

The US Dollar has been affected by the disappointing data, dropping versus most majors counterparts temporarily. Against Euro and Sterling, the greenback is currently trading in a range, but is gaining against the Japanese Yen and Canadian dollar in the later half of the US session.