US DATA: Pending Home Sales Still Pointing To Soft Activity
Aug-28 15:29
The National Association of Realtors' index of pending home sales fell to 71.4 in July from 72.0 prior, a 3-month low and a little worse than expected (-0.4% M/M vs -0.2% expected, -0.8% prior). This index is a leading indicator of existing single-family home sales and as such it doesn't appear that there will be any imminent pickup in activity from already historically low levels.
- Three of 4 regions (Northeast, Midwest, South) saw declines, with sales in the West picking up 3.7% but not offsetting the prior month's drop (-3.9%). Notably, sales in the Midwest fell to a 12-month low.
- On a Y/Y basis, pending sales are up 0.3% overall, though fell in the Northeast and West but were higher in the Midwest and South.
- Per NAR Chief Economist Lawrence Yun, "Even with modest improvements in mortgage rates, housing affordability, and inventory, buyers still remain hesitant. Buying a home is often the most expensive purchase people will make in their lives. This means that going under contract is not a decision homebuyers make quickly. Instead, people take their time to ensure the timing and home are right for them."
- The latest NAR housing forecast envisages a 14% increase in existing home sales in 2025 after 3% in 2025, with mortgage rates dropping to 6.0% from 6.7% amid strong US national job gains (2.0M in 2026, after 1.6M in 2025). Those forecasts for activity appear optimistic (existing sales are slightly lower through July so far).
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FED: US TSY 2Y FRN AUCTION: NON-COMP BIDS $25 MLN FROM $30.000 BLN TOTAL
Jul-29 15:15
- US TSY 2Y FRN AUCTION: NON-COMP BIDS $25 MLN FROM $30.000 BLN TOTAL
US TSYS: SOFR/Treasury Option Update: Put Volume Climbs
Jul-29 15:10
- +20,000 TYU5 108.5 puts, 3
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EUROPEAN FISCAL: German 2026 Budget To Be Published Tomorrow [2/2]
Jul-29 15:10
Recapping details from the sources reports below:
- Financing gap grew by around E28bln through 2029 since last month's 2025 budget press conference on the back of updated calculations after measures incl. the "growth booster" tax breaks, the expansion of maternity pensions and the recalculation of interest expenses.
- The government's goal is to "reduce these areas requiring action promptly and permanently"
- Nevertheless, it remains to be seen if they will be able to mitigate the topic becoming more central to the debate again, especially against the context that centre-right CDU has touted the magnitude of fundamental debt brake reform (Debt Brake Reform Commission Starts, Results Expected By Year-End) will be limited
- Barring some minor personnel and development aid cuts, concrete savings announcements have not been made yet. This appears likely to be picked up in the Q&A session with Klingbeil.
- Bundestag passing planned to be completed late November, Bundesrat passing by mid-December
- Note that figures released were broadly matching across reports and proved to be reliable last time (2025 budget, June 24).
| German Fiscal Metrics (Ebln) | 2025 (budget, presented in June) | 2026 (budget, new) | 2029 (financial plan) | 2025-2029 total |
|---|---|---|---|---|
| Core Budget Expenditure | 503 | 520.5 (vs 519.5 prior est) | ||
| Government Investment | 115 | 126.7 | ||
| Core Budget Net Issuance | 81.8 | 89.9 (vs 89.3 prior est) | 126.9 (vs 126.1 prior est) | |
| Special Fund Borrowing | 61.3 | 84.4 (vs 83.4 prior est) | ||
| Combined Net Issuance | 143.1 | 174.3 (vs 172.7 prior est) | 851.0 (vs 846.9 prior est) | |
| Interest Expenditure | 30.2 | 66.5 (vs 61.0 prior est) | ||
| Financing gap / "need for action" | 0 | 0 | 172.1 (vs 144 prior est) |
