New U.S. home sales drop on sharp decline in the West
By Lucia Mutikani
WASHINGTON (Reuters) - New U.S. single-family home sales unexpectedly fell in March, but the decline was concentrated in the West region, suggesting that the housing market continued to steadily improve.
The Commerce Department said on Monday new home sales decreased 1.5 percent to a seasonally adjusted annual rate of 511,000 units. February's sales pace was revised up to 519,000 units from the previously reported 512,000 units.
New home sales are volatile month-to-month because they are drawn from a small sample. While sales have now declined for three straight months, this likely does not signal a slowdown in the housing market given a buoyant labor market.
"Through some of the short-lived ups and downs in the data, it still appears that new home sales are trending higher over time," said Daniel Silver, an economist at JPMorgan in New York.
Economists had forecast new home sales, which account for about 8.7 percent of the housing market, rising to a 520,000 unit-rate in March. New home sales surged 18.5 percent in the Midwest and climbed 5.0 percent in the populous South.
But sales plunged 23.6 percent in the West, reversing February's 21.7 percent jump, and were flat in the Northeast.
U.S. financial markets were little moved by the data, with investors on the sidelines ahead of the Federal Reserve's policy meeting on Tuesday and Wednesday.
The U.S. central bank is expected to kept its short-term interest rates unchanged, but its statement accompanying the rate decision will be scrutinized for clues on the near-term outlook for monetary policy. Continued...