Agreements for Purchase of Previously-Owned Homes in U.S. Surge

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Agreements for Purchase of Previously-Owned Homes in U.S. SurgeThe number of Americans who agreed to purchase previously-owned homes advanced the most this year in July, indicating the housing market recovery is fast gaining momentum. The National Association of Realtors (NAR) reported on Thursday that its Pending Home Sales Index, which relies on contracts signed the previous month, jumped 3.3 percent to 105.9, the most since August 2013.

Economists in a Reuters poll had forecasted a gain of 0.5 percent in July.

The gauge nosedived last summer following an increase in mortgage interest rates, though it has since recovered starting March this year.

The contracts signed in July increased in the South, the Northeast and the West of the U.S., but declined in the Midwest.

Meanwhile, the U.S. economy grew faster than earlier estimated in the April-June quarter, with most of the growth being attributed to domestic demand.

Gross domestic product rose 4.2 percent, rather than 4.0 percent initially reported, said the Commerce Department on Thursday. Both exports and business spending were scaled up, though business inventory stockpiles were much smaller than expected.

Another report indicated that the number of Americans who filed for jobless claims fell for the second straight week. The number of jobless claims fell 1,000 to an annually adjusted figure of 298,000 last week.

“The economy is in good shape and getting better,” Joel Naroff, a Holland, Pennsylvania-based chief economist at Naroff Economic Advisers, told Reuters.

While the economy declined 2.1 percent in the first three months of 2014 due to the extreme winter weather, economists are optimistic that GDP growth will hit 2 percent this year, before accelerating to 3 percent in 2015.To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com