U.S Housing Starts Slipped by 1.1% in February 2012

According to this month’s U.S. Census Bureau report regarding the new residential construction statistics for February 2012 there was a slight decrease in housing starts but a rise in building permits.

Privately owned Housing starts decreased in February 2012: the seasonally adjusted annual rate reached 698,000 compared with 706,000 in January 2012 – this is a 1.1% decrease; alternatively, the annual rate for February 2012 was 34.9% above the February 2011 rate of 518,000.

Despite the drop in housing starts in February compared with the rate a month earlier, this rate is still much higher than a year earlier.

The seasonally adjusted annual rate of building permits for privately owned housing reached in February 2012 717,000 – a 5.1% increase compared with January’s annual rate of 682,000. The February 2012 rate was 34.3% above the rate in February 2011 (By the way, part of the sharp gain in Feb 2012 compared with Feb 2011 could be because of this is a leap year with one extra day).

This news provides a mixed signal for the progress of the U.S real estate market as the housing starts rose on a yearly scale but slightly slipped on a monthly scale, while building permits rose on both counts.

As I have stated in the past, there is a supposed lagged (by one day) and negative correlation between the development in housing starts and daily change in gold price; i.e. as Housing starts annual rates decreases, gold price tends to rise the following day. Therefore, the current decline in gold price might change direction tomorrow.

Current gold price, short term futures (April 2012 delivery) is traded at $1,649 per t oz. an $18 decrease as of 14:22*.

Euros to US dollar exchange rate is currently traded down at 1.3198 a 0.30% decrease as of 14:22*.

Current Nymex crude oil price, short term futures (April 2012 delivery) is traded down by 1.17% to $106.82 per barrel as of 14:22*.

(* GMT)

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