-David Crowe, NAHB's chief economist
US housing starts recovered strongly in June, while building permits surged to near the highest level in eight years, adding to signs of a rapidly strengthening housing market. Groundbreakings on new homes soared 9.8% to a seasonally adjusted annual rate of 1.17 million units, according to the Commerce Department. May starts were revised up to 1.07 million units from 1.04 million units reported previously. At the same time, permits for future home construction surged 7.4% to 1.34 million units, marking the highest level since July 2007. Measured on annual basis, housing starts rose 26.6%, while building permits advanced 30% in June. In addition to that, a survey showed builders' confidence stood at a more than nine-year high in July, reinforcing the view that both permits and groundbreaking have scope to increase further.
A separate report showed US consumer prices climbed for a fifth consecutive month in June amid higher fuel and food costs. The cost of living in the US rose a seasonally adjusted 0.3% in June from the previous month, the Labor Department reported. Measured on a yearly basis, prices inched up by 0.1%. When excluding volatile energy and food components, core prices climbed 0.2% last month and 1.8% from a year earlier. Meanwhile, US consumer sentiment declined more than expected in July. The University of Michigan's preliminary July reading on the index of consumer sentiment came in at 93.3, down from a final reading of 96.1 in June.
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