U.S. pending home sales at 10-month low

Demand for pending homes in the United States eased for a fifth consecutive month in October, as 16-day long government shutdown added to an overall slowdown in the nation's property market. The so-called pending home sales, adjusted for seasonal swings, plunged 0.6% from September, compared with a 4.6% drop a month earlier; however, much less than a 2.2% gain expected by analysts. On a yearly basis, sales fell 1.6%, hitting the lowest since December 2012. The indicator reflects the number of closed sales in November and December. After strong gains earlier this year, the housing market, one of the key measures of economic health for Ben Bernanke, has cooled, while potential buyers step back, struggling with higher prices and an increase in mortgage rates. Despite the fact, pending home sales have been falling during the last couple of month, the trade group expects closed sales to be almost 10% higher this year than in the previous one. 

The world's largest economy is facing a real dilemma. On the one hand, the economy is improving and the Fed is considering starting taper its stimulus programme soon, while from the other hand, consumer confidence fell in October, amid concerns over budget problems and political disputes, posing certain difficulties for policymakers. Moreover, signals from the Fed that it would scale back some of its QE caused mortgage rates to jump in the recent months.