US new home sales highest since 2008, dollar rises

U.S. new-home sales registered their strongest month in more than eight years in April, while house prices surged to a record level. The robust figures indicate a healthy housing market and suggests the US economic recovery is solid.

Purchases of new, single-family homes rose at the fastest pace since January 2008, with a jump of 16.6% from a month earlier to a seasonally adjusted annual rate of 619,000.

The median price of a new home—the point at which half of homes were sold above and half sold below—rose to $321,100 last month. That was up 9.7% from a year earlier and the highest level on record. Prices aren’t adjusted for seasonal factors.

The strong data help support the rising expectations of a Fed rate hike in the summer and even as soon as its June 14-15 policy meeting.

The dollar was pushed higher after the data on Tuesday. Many expect the dollar to rally further this year, as Fed officials signal their determination to increase rates at a time when Europe, Japan and China are using stimulus to bolster domestic demand for goods and services.

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