Considering the impact of winter storms, the market for new residential construction held its own in February with new construction at a seasonally adjusted 575,000 units, a 5.9 percent drop from the January estimate of 611,000 units – but is about even with the figure for a year ago, according to the Commerce Department.
Analysts had expected a figure as low as 510,000 units. And the January number was adjusted higher from the previous 591,000.
Building permits issued, an important indicator of future construction activity, recorded a seasonally adjusted 612,000, 1.6 percent below January’s rate, according to the Commerce Department.
But the February permits figure is 11.3 percent above the February 2009 estimate of 550,000 units. And the January rate of new construction permits was upwardly revised by Commerce to 622,000 units.
Single-family housing completions in February were at a rate of 458,000, 4.3 percent above the revised January rate of 439,000.
The housing market overall continues to struggle with the pace of foreclosures unabated and demand for existing homes sluggish at best.
Economists and financial market participants are expecting Federal Reserve officials today to hold the line with historically low interest rates and keep the key federal funds rate unchanged. But most are on watch to see if the Central Bank will modify its “extended period” pledge.
At least two Fed officials have raised concerns of inflation and excessive market speculation from maintaining such a locked-in position for a prolonged period. After today, the Fed’s monetary policy panel will meet six more times this year.
