U.S. housing starts tumble, flooding in the South blamed
U.S. housing starts fell more than expected in August likely as bad weather disrupted building activity in the South, but a solid increase in permits for single-family dwellings suggested demand for housing remained intact.
Tuesday's weak housing report came as officials from the Federal Reserve were due to gather for a two-day meeting to assess the economy and deliberate on monetary policy.
It joined a stream of recent soft economic data such as retail sales, nonfarm payrolls and industrial production, which, together with low inflation are expected to encourage the U.S. central bank to leave interest rates unchanged on Wednesday.
"Conditions seem well aligned for strong new home building. Borrowing costs remain low, the inventory of homes for sale, both new and existing, are relatively low and failing to make meaningful progress," said Kristin Reynolds, a U.S. economist at IHS Global Insight in Lexington, Massachusetts.
Dollar
The dollar edged up while world stock indexes were flat on Tuesday as investors awaited the outcomes of Federal Reserve and Bank of Japan policy meetings that will conclude on Wednesday.
Investor expectations are low that the Fed will raise U.S. short-term interest rates. But the focus will be on Chair Janet Yellen's speech on Wednesday for any hint that the U.S. central bank could hike rates as soon as December.
The dollar index rose 0.2 percent .DXY to 95.995, just below the 96.108 mark touched on Friday that was the highest since Sept. 1.
OIL
Oil prices climbed on Wednesday, supported by a reported draw in U.S. crude inventories and by firm import data from Japan.
U.S. West Texas Intermediate (WTI) crude futures were up 1.79 percent, or 79 cents, at $44.84 a barrel at 0027 GMT, buoyed by a contractual roll over into higher-demand November as a front-month.
Traders said that the main WTI price driver had been American Petroleum Institute data showing a 7.5-million barrel draw to 507.2 million barrels in U.S. crude inventories, the third weekly stock draw.
International benchmark Brent crude oil futures were trading at $46.46 per barrel, up 58 cents, or 1.26 percent, from their last close.
Reference: Reuters
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