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Home Sales Drop, But Consumer Confidence Rises


Sales of previously-owned homes in the United States declined in May as higher mortgage interest rates cut demand.

Tuesday's report from a business group, the National Association of Realtors, says re-sales fell more than one percent. If home sales continued at this rate for a full year, 6.7 million homes would change hands.

Tuesday's report on existing home sales contrasts sharply with Monday's figures on sales of newly-built homes, which increased. But analysts say new home sales are likely to decline under pressure from rising interest rates.

U.S. central bankers are expected to announce another in a long series of interest rate increases later this week.

A separate report said U.S. consumer confidence increased slightly this month.

Consumer confidence figures give experts clues about consumer spending, which drives most U.S. economic activity.

Some information for this report was provided by AFP, AP and Reuters.
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