FXStreet (Delhi) – Yann Quelenn, Market Analyst at Swissquote Bank, suggests that the housing market is an important gauge to more accurately appraise the real situation in the U.S even if officially Fed members’ attention is said to remain focused on inflation and jobs data. Key Quotes “Indeed, hawkish members claim that employment conditions would fuel inflation, while doves support the idea of a reserve army that would flow back in the job markets as soon as the situation improves. In any case, it is clear that there is growing dissension surrounding jobs market statistics, which are been said to not accurately depict the current situation. Therefore, it is important to get additional evidence that would support a monetary change. We strongly believe that housing data will provide additional evidence that the U.S economy is struggling to recover.” “Low interest rates and steady unemployment have provided important traction to underpin the housing market. This is unlikely to stop as last month’s October existing home sales increased by 4.7% m/m against the backdrop of constant jobs creation and mixed economic conditions.” “The main issue is that the era of zero interest-rate is not over and this adds upside pressures to house prices. On the contrary, the negative global outlook is adding downside pressures to today’s existing home sales, which we expect to print in lower than consensus at -2.7% m/m.” “The EURUSD is set to gain on this data release. Events outside of the U.S won’t be the only drivers for broad USD trend. The economic situation in the U.S is largely overestimated and the Fed will soon have a hard time justifying the inefficiency of the three quantitative easings they have launched over the past seven years. The greenback is currently strengthening on over exaggerated December Fed rate hike hopes. Over the very short-term, we expect a retracement of the pair towards 1.0700.” For more information, read our latest forex news.