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Housing starts rose 4.8% in June to a 1.189M annualized rate, with permits up 1.5%. This brings the second quarter to a 0.8% improvement over the first quarter. Single-family home starts rose 4.4% with permits only up 1.0%. Multi-family homes, a much smaller segment, is bouncing back from a weak start to the year with a 5.4% increase in starts and a 2.5% increase in permits. The report overall shows modest gains that may be materially assisting broader economic growth.
Existing home sales adds more substantially to the picture of an increasingly healthy housing sector, with a 1.1% gain in June for an annualized rate of 5.570M, the best of the cycle since February 2007. Single-family sales rose 0.8% M/M and 3.1% Y/Y while condos were up 3.2% M/M and 1.6% Y/Y. The combined Y/Y rate is 3.0%. Pricing rose to a 4.7% gain Y/Y. Meanwhile, supply fell 0.9% for the month, which contributed to the pricing increases.
Jobless claims remain at the lowest levels of the recovery, with initial claims falling 1,000 to 253,000, well below the consensus, which had predicted an increase. Continuing claims were also down, falling by 25,000 to 2.128M. Missing from the report were layoffs from auto retooling—July is when automakers traditionally shut down plants for retooling. When figures from retooling are included, expect a sizeable increase in jobless claims.
Wed July 27 — FOMC Meeting Announcement (sets interest rate policy)
Fri July 29 — Gross Domestic Product (measure of economic activity)