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.
2) 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?
Mike "Mish" Shedlock