US homebuilder confidence edges lower in October, NAHB says

Builder confidence in the States edged lower in October but remained at its second-highest level of 2016, albeit amid concerns about a shortage of construction lots and labour.

The National Association of Homebuilders's/Wells Fargo housing market index dipped by two points to a level of 63.0, as expected by economists.

“The October reading represents a mild pullback from a jump in September, and indicates that the housing market continues to make slow and steady gains,” said NAHB Chief Economist Robert Dietz.

Dietz highlighted that mortgage rates remained low and the HMI index tracking expectations for future sales had been over the 70-point mark for the prior two months.

"These factors will sustain continued growth in the single-family market in the months ahead,” he said.

A sub-index for current sales conditions fell by two basis points to 69.0 while the sub-index of buyer traffic retreated by one point to 46.0.

"Even after this month's fall, the headline index is consistent with higher new home sales over the next couple of months. Beyond that we worry about the lagged impact of the decline in mortgage applications over the summer; it's hard to see where the next leg-up in sales is going to come from," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

As of 1519 BST the yield on the benchmark US Treasury 10-year note was higher by one basis point to 1.77%.