logo
  Join        Login             Stock Quote

Housing Starts Rise Sharply In 2012's Final Month

 January 17, 2013 10:35 AM


New residential construction in December rose substantially more than expected, posting a 12.1% increase last month (seasonally adjusted annual rate). Yours truly and several consensus forecasts were looking for a solid but considerably lesser growth rate of around 3.0%, as I noted yesterday. The key point, of course, is that the housing recovery remains on track, as today's update reminds in rather convincing terms.

Housing starts are near a five-year high. A similarly bullish trend also describes the recent data for newly issued housing permits, which are considered a leading indicator of starts. Although permits rose only marginally in December, that's enough to keep this series near a five-year high as well.

[Related -Initial Jobless Claims Rose Unexpectedly]

From a business cycle perspective, today's housing report data delivers another positive number for the December economic profile. Last month's tally of housing starts is nearly 37% above the year-earlier level.

[Related -All Quiet on the Record High Front]

Starts are one of the indicators in The Capital Spectator Economic Trend Index (CS-ETI), and with the latest news this data series enters the December column with a familiar refrain: growth. As I noted in last week's update of CS-ETI, recession risk remained low, based on available data. A week later, the observation still stands; in fact is considerably stronger, after a week of economic updates.

In the last few days we learned that both retail sales and industrial production posted gains in December and, more importantly, remained in positive territory on a year-over-year basis. Housing starts round out the week with a third installment of encouraging news.

In short, it's all but certain now that 2012 escaped recession. That's no surprise, of course. A broad reading of the numbers all along has routinely told us that the economy's momentum was firmly in the positive column, as CS-ETI has shown for months. Yes, the data points for personal income and spending numbers for December are yet to come. And there's always the potential for data revisions that paint a far darker cyclical picture. Anything's possible, as always. Based on the available numbers, however, the case is quite firm for expecting that the final analysis on the business cyclical history for 2012 will declare the year as one that was recession-free.
iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageInitial Jobless Claims Rose Unexpectedly

Claims unexpectedly rose in the latest report through last weekend to breach 300,000 for the first time read on...

article imageAll Quiet on the Record High Front

What can we glean from the media’s lack of attention to the market’s recent record read on...

article imageThe Chip Maker Short Sellers Should Be Watching

Investing in semiconductor stocks is always tricky. Industry cycles can lead to bumps in the road for the read on...

article imageChicago Fed: US Economic Growth Slowed In October

The pace of US growth slowed more than expected in October, according to this morning’s update of the read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.