Housing Starts Well Above Expectations, But Building Permits Fall
US Housing Starts rose sharply to 1.49 million, well above the 1.34 million forecast and also higher than the previous figure of 1.40 million. This increase signals that housing construction activity remains quite strong, despite relatively high financing costs.
However, the picture is not entirely smooth, as the previous release showed Building Permits actually fell to 1.38 million from 1.45 million, lower than expected. This combination creates a mixed market reading: strong starts could reflect projects already underway, while weak permits could signal a potential slowdown in the pace of new projects going forward.
Market Impact (in brief):
USD: Strong starts data can provide slight support, but the impact is usually limited because the FX market is more sensitive to inflation, yields, and geopolitics.
Yield: Could rise slightly if the market views this data as additional evidence of a resilient economy, but the main direction remains determined by inflation/employment data.
Gold: Little immediate reaction; Gold moves more in line with USD yields and oil headlines.
Next things to watch:
whether the housing trend is confirmed by existing/new home sales and credit/mortgage data,
whether the decline in permits continues (a leading indicator for construction),
the reaction of Treasury yields and interest rate pricing, which determine the broader direction of the USD.(Cp)
Source: Newsmaker.id
