Preview: Due May 16 - U.S. April Housing Starts and Permits - Trend has little direction
We expect April housing starts to rise by 5.7% to 1400k after a fall of 11.4% in March, while permits fall by 0.5% to 1460k after a 0.5% increase in March. While starts have been more volatile than permits in recent months, trend continues to have little direction.
Housing data has been mixed with weakness in some surveys but little direction to the trend in new home sales, which delivered a strong month in March. April’s non-farm payroll showed a modest rise in construction employment but slippage in the workweek.
We expect single starts to rise by 7.4% after a 14.2% decline in March and multiple starts to rise by 1.6% after a 3.5% fall in March. For permits we expect singles to rise by 1.7% after a 2.5% March decline while multiples fall by 4.9% after a 7.2% March increase.
Looking ahead risk leans on the downside with the Fed only likely to ease significantly if the economy weakens significantly, suggesting some restraint from either restrictive policy or a weakening economy.
