US Economy On Track For Recovery?

The US housing market may be experiencing something of a turnaround, according to a series of official figures released today.

In figures released today by the US Commerce Department, the number of new properties sold in the US over the course of last month increased by 2.8%, up to 870,000 for the year.

The figures appear to show a turnaround in the fortunes of the housing market, which has been a major contributor to the US’ economic woes over the last few months.

Furthermore, with the ongoing crisis in the sub-prime lending market still dragging down US growth and consumer confidence, analysts were shocked to discover home sales had actually increased over the course of July.

Particularly after the 4% decrease in home sales in June, analysts had widely forecast yet more negative growth for new home sales in the US economy.

Additionally, the US Commerce Department added momentum to reports of a potential economic recovery with the news that factory output had grown by almost 6% over the course of July.

The rise takes US factory output to a ten-month high, and was well received on the US stock exchanges, as was the news of the upturn in housing, as complimentary indicators of economic progress.

After the recession forecast by leading mortgage lender Countrywide just yesterday, investor confidence in the US economy had hit new lows, with stock market volatility and corporate investment significantly down on the year.

However, some experts are predicting that the recent recovery on the stock markets, combined with the perceived upturn in economic activity could be enough to jolt the economy back on track over the coming months.

Despite the apparent upturn today, many investors will still exercise caution as the full extent of the sub-prime crisis begins to unfold over the coming months.

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