US housing starts post surprise fall in July
The Commerce Department has revealed a fall in US housing starts for the month of July ending three months of gains.
According to the Commerce Department, construction of new US homes fell 1% in the month to an annual rate of 581,000 properties.
However, there was a fifth straight monthly rise in single family home starts, increasing 1.7% compared with the previous month to an annual rate of 490,000 units – the highest level since October.
Meanwhile, applications for building permits, a barometer of future home construction, fell 1.8% to an annual rate of 560,000 units and were down 39.4% from a year earlier.
Despite hopes of a turnaround within the US economy, the housing market is still a long way from pre-recession levels. Housing starts in June were still almost 38% below levels seen in July 2008.
The housing market is key to a recovery and is one of the primary reasons the US is in the midst of its worst economic downturn in 70 years.
However, on a positive note, The National Association of Home Builders said yesterday its index of industry confidence grew in August to the highest level in over a year.
In other news for the world’s largest economy, it has been revealed that US wholesale prices recorded an unexpected fall last month, with prices falling 0.9% compared with the previous month.
Meanwhile, core wholesale prices (which strip out the volatile cost of energy and food) were down 0.1% during the month compared with June.
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