U.S. residential construction fell in January but a jump in permits for future home building to a 4-1/2 year high offered hope the housing market recovery remains on track.
Another report on Wednesday showed wholesale prices rose for the first time in four months in January as rising food costs offset weak gasoline prices. However, sluggish economic growth should keep price pressures muted.
Housing starts dropped 8.5 percent last month to a 890,000-unit annual rate, pulled down by a sharp drop in the volatile multi-family unit category, the Commerce Department said.
But starts for single-family units hit their highest level since July 2008 and permits for future home construction were at a 4-1/2 year high.