November 27, 2007—Housing starts rose 3.0% in October but are down 16.4% compared to last year. Concurrently, the Conference Board's Index of Leading Indicators fell 0.5%.

New Residential Construction
Housing starts rose 3.0% to 1.229 million units in October following an 11.4% drop in September. Despite the increase, housing starts are down 16.4% on a year-ago basis. Housing permits decreased 6.6% to 1.178 million units and are down 24.5% compared to a year ago. Despite the cut in the funds rate by the Fed and the October increase, the housing market is still weak and housing starts will be constrained for the remainder of 2007.

Conference Board's Leading Indicators
The Conference Board's Index of Leading Indicators fell 0.5% in October, following a 0.1% uptick in September. Seven of the ten components made negative contributions to the index, led by lower building permits, higher initial jobless claims, and shorter manufacturer delivery times. Over the last 3 months, the index has decreased at a 4.8% annual rate while the 6-month annualized growth rate is -1.0%.