USD Steady as US Existing Home Sales Beat at 4.06M, Housing Affordability Eyed

US existing home sales for July came in slightly above expectations at 4.06 million units versus the 4.05 million forecast, though down 1.7% from the prior reading of 4.09 million. The median home price rose 2.0% year-over-year to $434,100, while housing inventory held steady at 4.6 months of supply. The data paints a picture of a housing market in a holding pattern, constrained by elevated mortgage rates driven by rising Treasury yields. When adjusted for CPI, housing affordability shows a slight but steady improvement, offering a modest positive signal for consumer purchasing power. The key variable for the US dollar going forward is the trajectory of borrowing rates, which directly ties to Federal Reserve policy expectations and Treasury market dynamics. For forex traders, the data is broadly neutral for the USD, as it neither supports aggressive rate cuts nor signals economic deterioration. Near-term USD pairs may remain range-bound pending clearer signals from upcoming inflation or employment data. Traders should monitor the 10-year Treasury yield as a leading indicator for mortgage rate direction and broader dollar sentiment.