US homebuilding fell to a more than 2-year lows in December as construction of both single and multi-family housing declined, the latest indication that the economy lost momentum in the fourth quarter.
Other details of the report from the Commerce Department on Tuesday were also downbeat and suggested that the housing market could remain sluggish for a while despite an easing in mortgage rates.
Housing completions dropped to a more than 1-year low in December and while building permits increased, they were driven by the volatile multi-family housing segment.
Housing starts dropped 11.2% to a seasonally adjusted annual rate of 1.078-M units last month, the weakest reading since September 2016.
Data for November was revised down to show starts at a 1.214-M unit rate instead of the previously reported pace of 1.256-M units.
Building permits rose 0.3% to a rate of 1.326-M units in December.
Economists polled by had forecast housing starts slipping to a pace of 1.250-M units last month.
The release of the December housing starts and building permits report was delayed by a 35-day partial shutdown of the federal government that ended on 25 January.
No date has been set for the release of January’s report.
The Commerce Department said while delays in data collection could make it more difficult to determine the exact start and completion dates of construction, “processing and data quality were monitored and no significant issues were identified.”
The USD extended losses against a basket of peer currencies on the report, while US Treasury prices rose. US stock flat to unchanged.