posted
WASHINGTON (MarketWatch) - Construction of new U.S. houses fell sharply in March after hitting a 21-year high in the previous month, the Commerce Department estimated Tuesday.
Housing starts fell 17.6% in March to a seasonally adjusted 1.837 million annualized units. Read government release.
The drop was much larger than expected. Economists were looking for starts to fade to 2.09 million. See Economic Calendar
February's new construction was revised higher to 2.229 million from the 2.195 million level reported last month. This was the highest rate of housing starts in 21 years.
Building permits for new housing fell 4% to a 2.023 million annual rate. This is the lowest level since last August. Single family permits fell 5.4% to 1.552 million.
Both apartment and single family housing starts fell sharply in March.
Starts of new single-family homes fell by 14.4% to a 1.539 million seasonally adjusted annual rate. This is the also sharpest decline since Jan. 1991.
Apartment starts fell 31.6% to 258,000. This is the sharpest decline since March 2000.
In March, starts in the Midwest fell 29.3% to 309,000. This is the lowest of starts since Feb. 2003.
Starts in the South fell 18% to 837,000. Starts in the West fell 12.7% to 503,000. In the Northeast, starts fell 3.6% to 188,000.
The government's housing data are subject to large sampling and other statistical errors. Seasonal adjustment is particularly tricky during winter months, when weather plays a crucial factor.
The government cautions that it can take up to five months for a new trend to be established in starts.
IP: Logged |
posted
U.S. core producer prices remain tame March prices rise 0.7% on energy spike By Rex Nutting, MarketWatch Last Update: 8:46 AM ET April 19, 2005
WASHINGTON (MarketWatch) - Soaring energy prices pushed U.S. producer prices up by 0.7% in March, but core inflation remained tame, the Labor Department reported Tuesday.
Core prices, which exclude food and energy, increased 0.1% in March, the agency said.
The 0.7% increase in the Producer Price Index was a bit higher than the 0.6% expected by Wall Street economists, but the 0.1% gain in the core rate was much lower than the 0.3% estimated in the survey conducted by MarketWatch. See Economic Calendar.
The PPI is now up 4.9% in the past 12 months. The core rate is up 2.6%. The PPI had risen 0.4% in February, with the core rate up 0.1%. Read the full release.
In a separate report, the Commerce Department said housing starts plunged 17.6% to a seasonally adjusted annual rate of 1.84 million. See full story.
Energy was the main culprit in the March PPI, with energy prices rising 3.3%, the largest gain since October when a similar oil spike shook the U.S. economy. Wholesale gasoline prices jumped 5.3%, home heating oil prices rose 15.7% and residential natural-gas prices rose 2.3%.
Inflation was also seen further back in the production cycle. Prices of intermediate goods destined for further processing increased 1% and crude goods prices increased 4.3%.
The main question for the Federal Reserve is whether higher energy prices are being passed along to final consumers, setting an inflationary psychology among businesses and consumers.
The Labor Department will report on the consumer price index on Wednesday. Analysts expect the CPI to rise 0.4% with the core CPI up 0.2% in March.
So far, companies have had limited success in passing along their higher costs to consumers, although some spillover has been seen.
A secondary question for the Fed is whether higher energy prices will cripple the global economy. March spending data were soft, an indication that consumers may have pulled back on discretionary spending.
The Federal Reserve's Open Market Committee will meet May 3. Most analysts and market signals are forecasting another quarter percentage point increase in short-term interest rates.
In March, finished consumer foods prices rose 0.3%. Finished capital goods prices also rose 0.3%. Motor vehicle prices fell 0.2%.
Intermediate energy goods prices increased 3.7%. Prices of intermediate goods excluding food and energy increased 0.3% in March, matching the lowest increases in the past year.
Crude energy goods prices increased 5.5% in March.
IP: Logged |
UBBFriend: Email this page to someone!
Printer-friendly view of this topic
