US existing home sales, Japanese trade surplus fall

The US housing market continues to show signs of weakness. From Reuters:

Sales of existing homes fell 4.1 percent in July, the fourth consecutive decline, to a seasonally adjusted annual rate of 6.33 million units from a revised 6.60 million unit pace in June.

The July pace, the slowest since January 2004, was 11.2 percent below the July 2005 pace of 7.13 million...

According to the Realtors data, the national median existing home price for all housing types was $230,000 in July, up 0.9 percent from July 2005, the smallest year-on-year price gain since May 1995.

The supply of homes for sale at the end of July jumped sharply by 3.2 percent to 3.86 million units. This represented a 7.3 months' supply, the highest since April 1993.

But it was not all bad news in the housing sector.

U.S. mortgage applications rose for a third straight week as falling interest rates prompted homeowners to refinance loans. The refinancing increase offset a decline in mortgages to buy homes. The Mortgage Bankers Association reported its seasonally adjusted index of mortgage application activity last week edged up 0.1 percent.

Over in the UK, the housing market is expected to be stable. Again from Reuters:

Short supply, a steady economy and demand for property as an investment should keep the country's housing market on an even keel, despite this month's surprise interest rate hike, housebuilders believe.

However, they caution that prices are unlikely to rise much further and that market conditions could get tougher if the Bank of England signals that more rate increases are on the way.

There was also good news for the UK in the manufacturing sector, as August’s Monthly Industrial Trends Survey by the CBI shows manufacturing demand at its strongest in 20 months.

But of course, it is the slowdown in the US that most other countries are concerned about, not least Japan, which saw its trade surplus narrow for a second month in July. Bloomberg reports:

The trade surplus narrowed 0.2 percent to 859.9 billion yen ($7.4 billion) from a year earlier, the Ministry of Finance said in a report today in Tokyo. The median forecast of 37 economists surveyed by Bloomberg News was for the surplus to widen to 950 billion yen...

Exports rose 14.2 percent from a year earlier, less than the 15.3 percent median forecast of 11 economists. Imports climbed 16.8 percent, more than the 16.4 percent expected, though slower than the 18.3 percent growth in June.