Pound Sterling to US Dollar (GBP/USD) Exchange Rate today – Dollar falls as home sales data disappoints

The US Dollar declined against the Pound on Monday afternoon after data showed that new home sales in the world’s largest economy fell more than expected in December.

According to the Washington based Commerce Department, sales of newly built homes declined by 7% to a seasonally adjusted figure of 414,000, down from November’s figure of 445,000. That months figure was also revised downwards by 19,000. The data ended the housing sectors best year since 2008 on a relatively bad note.

The decline in sales is being blamed on the inclement cold weather that has affected large parts of the US. Potential buyers are also having to adapt to higher property prices and borrowing costs which has impacted on affordability. The average price of a new property in the US rose by 4.6% to $270,200.

The National Association of Realtors last week said 5.09 million existing homes were sold in 2013. That was up 9% from 2012 and the best annual performance since 2006.

Investors will now be looking ahead to the Federal Reserve’s monthly policy meeting on Wednesday. Expectations are high that the Central Bank’s policy makers will opt to reduce its bond buying programme from $75 billion to $65 billion per month.

Sterling is likely to remain supported tomorrow as Tuesday sees the release of data which is expected to show that the UK economy expanded in every quarter of 2013, the first time it has done so since the start of the financial crisis.