The gloom enveloping the US housing market intensified yesterday as home prices dropped at the fastest annual rate since records began 20 years ago.
The S&P/Case Shiller national house price index fell 14.1% in the first quarter of this year, compared with the same period a year earlier, a decline that threatens to delay any recovery in the broader economy.
Recent data, including the latest jobs report, have painted a picture of a domestic economy that is slowing but not yet in recession territory, a point that may gain further ground on Thursday when the US government is expected to revise higher its initial estimate of first quarter economic growth.
But US consumers do not seem to be getting the message. Consumer confidence plumbed a 16-year low this month, as rising food and petrol prices combined with the housing slump to dampen expectations.