New home sales put in huge back-to-back percentage gains, the most in nearly three decades, and steamrolling expectations according to Mortgage News Daily.
New Home Sales by Region
For whatever reason there was a 30.2% suge in the Northeast and a 17.9% surge in the Midwest according to the Census Bureau report on New Residential Construction.
Bond Market Reaction
I like to watch the bond market reaction following economic reports.
Curiously, 10-year and 5-year yields are down 1 basis point, the rest are flat. I view this as no overall reaction.
If the expectation was a jump in inflation or a strengthening of the economy, yield at the long end should have jumped.
A reader asked "why would the Fed stop hiking?" That's easy.
- Sustained stock market decline
I expect both.
For further interest rate discussion, please see What Will the Yield Curve Look Like if the Fed Hikes in Dec and March?
Also consider What Spot in the Yield Curve is Likely to Invert First?
Mike "Mish" Shedlock