U.S. housing starts likely to have dropped further in October

Housing starts in the U.S. fell more than anticipated in September to 1.127 million-unit pace as building activity was impacted in the South due to Hurricanes. Housing starts for the August month were upwardly revised though. Permits also came in above starts in September, setting the stage for a recovery in months ahead. Housing starts are expected to have dropped further to 1.167 million in October, noted Wells Fargo in a research report.

Repairs of damaged homes might impact activity over the next few months by worsening labor shortages or driving up building costs, or by causing delays for new projects. Additional volatility is expected in the fourth quarter.

“Residential investment in the GDP calculations declined 6 percent in Q3, and we expect another small decline in Q4 before a rebound in the first half of 2018”, added Wells Fargo.

The NOAA also forecasts another warmer-than-usual winter that might worsen volatility into next spring.

At 20:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was neutral at -17.7745. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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