Wednesday, April 16, 2008

Consumer prices muted as housing starts reach 17-year low

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WASHINGTON (Reuters) - The number of U.S. housing projects started last month fell to the lowest in 17 years, while consumer prices moved up a bit less than expected, leaving the Federal Reserve some room to lower interest rates to ward off a housing-led slowdown.

While the slide in the housing sector continued, industrial production unexpectedly rebounded as utilities raised output due to colder weather, making up for weak manufacturing growth.

The Commerce Department said on Wednesday that housing starts dropped 11.9 percent in March to an annual rate of 947,000 units, the slowest pace since March 1991 and well below the 1.02 million expected by economists.


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