US Housing Starts: A gradually improving trend despite May’s slide - Wells Fargo

Data released today showed that a smaller than expected decline in May Housing Starts. Analysts at Wells Fargo point out despite the drop, there were a few rays of sunshine within the report, as prior months’ data were revised higher and also noted single-family permits rose for the first time in six months.

Key Quotes: 

“New residential construction continues to have trouble building momentum despite lower building costs and improved buying conditions. Total housing starts dropped 0.9% during May. A 10.9% rise in volatile multifamily starts was not enough to offset a 6.4% decline in single-family units.”

“Starts remain 5.3% below their prior-year pace on a year-to-date basis. That noted, residential building continues to be fairly solid. The 1.269 million-unit pace hit in May is slightly above the 1.222 million-unit pace averaged over the past six months. Starts for both March and April were also revised higher, and now show 6.8% and 4.4% monthly gains, respectively.”

“A 0.3% rise in total building permits during May also provides some cause for optimism.”

“The gain in permits along with more favorable buying conditions points to gradually improving activity over the summer. That said, lower mortgages rates will not likely be rocket fuel for residential construction, and a surge in activity is unlikely.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD: risk aversion could send it sub-1.1180

EUR/USD capped by a critical Fibonacci resistance for two weeks in-a-row. The American dollar has closed the week on a high note as hopes for significant rate cuts faded.


GBP/USD: bears to retake control on a break below 1.2475

Renewed demand for the greenback has resulted in the GBP/USD pair giving back half of its Thursday’s gains at the end of the week, with the pair closing it just above the 1.2500 figure.


USD/JPY: bearish case firmer once below 107.20

The USD/JPY pair flirted with the 108.00 level by the end of the week on renewed demand for the greenback but retreated sharply from the level to settle at around 107.70.


Gold consolidates around $ 1440, eyes US data for fresh direction

Gold (futures on Comex) extends its side-trend around the 1440 mark into the mid-European session, having stalled its retreat from 2019 highs of 1454 near 1437 region.

Gold News

Something has spooked the Fed

We wish we knew what it is. Wild talk of the US joining Japan and Europe with zero or negative return on the 10-year is or should be very frightening.

Read more