PPI [6-16-2010] – Futures Broker

WASHINGTON, June 16 (Reuters) – U.S. housing starts fell
more than expected in May to their lowest level in five months,
a government report showed on Wednesday, as a popular homebuyer
tax credit that had buoyed construction activity over the past
two months expired.
The Commerce Department said housing starts dropped 10
percent to a seasonally adjusted annual rate of 593,000 units,
the lowest level since December. The percentage decline was the
biggest in 14 months. April’s housing starts were revised down
to show a 3.9 percent increase, which was previously reported
as a 5.8 percent rise.
Analysts polled by Reuters had expected housing starts to
fall to 650,000 units. Compared to May last year, starts were
up 7.8 percent.

rdtrader:
NEW YORK, June 16 (Reuters) – U.S. housing starts fell 10
pct, more than an expected fall of 3.3 pct, in May to their
lowest level in five months in Commerce Department data on
Wednesday.
A popular homebuyer tax credit had buoyed construction
activity over the past two months but expired in April.
Housing starts dropped to a seasonally adjusted annual rate
of 593,000 units, the lowest level since December.
The percentage decline of 10 pct was the biggest in 14
months. April’s housing starts were revised down to show a 3.9
percent increase, which was previously reported as a 5.8
percent rise. Compared to May last year, starts were up 7.8
percent.
New building permits, which give a sense of future home
construction, dropped 5.9 percent to a 574,000-unit pace in
May, the lowest in a year. That followed a 10.9 percent drop
in April and compared to analysts’ forecasts for a rise to
630,000 units.
Analysts believe the pullback in housing will be temporary,
citing the gradual improvement in the economy. Demand for
loans to buy homes rebounded from 13-year lows last week.

In other data, the U.S. producer price index fell in May as
the cost of energy plunged, buying the Federal Reserve some
time to maintain its ultra-low interest rate policy.
The Labor Department on said on Wednesday its producer
price index, which measures costs at the wholesale level, fell
0.3 percent last month. Compared to a year earlier, prices rose
5.3 percent overall.
But the core reading excluding food and energy climbed just
1.3 percent, slightly above forecasts but still near the lower
bound of the U.S. central bank’s presumed comfort range.