US new home sales rose in October for a second straight month. On a monthly basis, new home sales increased by 1.3% M/M to a total level of 307 000, but the previous figure was significantly downwardly revised. The outcome was slightly weaker than expected. Regional details show that strength in the Midwest (22.2% M/M) and West (14.9% M/M) was offset by somewhat weaker sales data from the Northeast (0.0% M/M) and South (-9.5% M/M). The number of new homes for sales stayed unchanged at a record low of 162 000 and months’ supply dropped from 6.3 to 6.4. Both average and mean prices continued to drop in October. The market for new homes is facing intense pressure from large inventories of existing and foreclosed homes, which often sell at a discount. Construction activity remains therefore weak and an improvement is not expected soon.