After reporting a substantial increase by new residential construction in the U.S. in the previous month, the Commerce Department released a report on Wednesday showing housing starts pulled back by more than expected in the month of January.
The Commerce Department said housing starts plunged by 9.8 percent to an annual rate of 1.366 million in January after soaring by 16.1 percent to an upwardly revised rate of 1.515 million in December.
Economists had expected housing starts to tumble by 6.6 percent to an annual rate of 1.400 million from the 1.499 million originally reported for the previous month.
The sharp pullback came a month after housing starts surged to their highest level since hitting an annual rate of 1.546 million in February 2024.
Meanwhile, the report said building permits inched up by 0.1 percent to an annual rate of 1.483 million in January after falling by 0.7 percent to a slightly downwardly revised rate of 1.482 million in December.
Building permits, an indicator of future housing demand, were expected to slump by 1.6 percent to an annual rate of 1.460 million from the 1.483 million originally reported for the previous month.
The Treasury Department is scheduled to announce the results of this month’s auction of $16 billion worth of twenty-year bonds at 1 pm ET.
At 2 pm ET, the Federal Reserve is due to release the minutes of its January monetary policy meeting, when the central bank decided to leave interest rates unchanged following three straight rate cuts.
Federal Reserve Vice Chair Philip Jefferson is scheduled to speak on “Household Balance Sheets” at a Martin H. Crego Lecture in Economics event hosted by Vassar College at 5 pm ET.