US Housing Starts Jump 21.7% in May, Building Permits Rise 5.2%
The US housing market showed signs of life in May, with housing starts jumping 21.7% on a monthly basis. This was the largest monthly increase since March 2020, and it easily beat economists’ expectations for a decline of 0.8%.
The surge in housing starts was driven by a strong increase in single-family starts, which rose 24.2%. Multifamily starts also increased but at a more modest pace of 14.4%.
The increase in housing starts was accompanied by a rise in building permits, which rose 5.2%. This was the first increase in building permits in three months.
The strong data on housing starts and building permits is a positive sign for the US economy. It suggests that the housing market is beginning to recover from the slowdown that it experienced in the first quarter of 2023.
The increase in housing starts is also likely to boost demand for construction materials, which could help to support economic growth in the coming months.
What does this mean for the US Dollar?
The strong data on housing starts is likely to boost the US Dollar in the near term. The US Dollar is often seen as a safe haven currency, and it tends to appreciate when there are positive economic developments in the US.
The increase in housing starts could also lead to higher interest rates in the US. This is because the Federal Reserve is likely to view the strong housing market as a sign that the economy is overheating.
Higher interest rates would make the US Dollar more attractive to investors, which could further boost the currency.
Overall, the strong data on housing starts is a positive sign for the US economy and the US Dollar. The housing market is beginning to recover, and this could lead to higher interest rates and a stronger US Dollar in the coming months.thumb_upthumb_downuploadGoogle itmore_vert