A forward-looking index of US home sales bounced back and consumer borrowing surged in spite of tough credit conditions in June, offering some respite from bleak data on the economy.

The National Association of Realtors said yesterday its gauge of pending home sales, which measures contracts signed but not completed, rose 5.3 per cent in June to a level of 89.0. That was 12.3 per cent below the index's reading in June 2007, but still marked a clear improvement on the small drop expected by most economists, especially given that mortgage rates were rising during the month.