U.S. housing starts rose to a near eight-year high in July as builders south of the border ramped up construction of single-family homes, suggesting that the economy was firing on almost all cylinders.
The U.S. Commerce Department report on Tuesday added to solid payrolls, retail sales and industrial output data in suggesting the economy got off to a strong start in the third quarter. The steady flow of upbeat economic reports has bolstered views that the Federal Reserve will raise interest rates in September.
Groundbreaking increased 0.2% to a seasonally adjusted annual pace of 1.21 million units, the highest level since October 2007. June's starts were revised sharply higher to a 1.20-million-unit rate from the previously reported 1.17-million-unit pace.
Housing starts have now been above a one-million-unit pace for four straight months. Economists had forecast groundbreaking on new homes rising to a 1.19-million-unit pace last month.
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