U.S. Dollar gains on inflation data. - Forex & Currency Trading Blog

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February 20, 2008 - Forex Economic News

U.S. Dollar gains on inflation data.

The U.S. dollar increased today against most major currencies after news released showed a rise in inflation. The Consumer Price Index rose by 0.4 percent in January after a revised 0.4 percent rise in December according to the Department of Labor. The cpi data exceeded market expectations that forecasted a 0.3 percent increase and January's data showed a rise of 4.3 percent over the level recorded in January 2007. Food and energy prices each increased by 0.7 percent in January while apparel, medical care, recreation, education and communication, and other goods and services all showed gains for the month. Core CPI, which doesn't include food and energy prices, was up 0.3 percent for January which represented the largest increase since June of 2006 and above December's reading of a 0.2 percent increase. Core CPI compared to January 2007 showed an increase of 2.5 percent.

Residential Construction data.

The Commerce Department released data today on new residential construction in the U.S. Housing Starts for January increased by 0.8 percent to an annual rate of 1,012,000 compared to December's revised number of 1,004,000 but despite the increase today's numbers were 27.9 percent less than recorded in January 2007. Single-family housing starts totaled 743,000 which was 5.2 percent less than December. Building permits statistics, a predictor of future construction, totaled an annual rate of 1,048,000 in January which was a decrease of 3.0 percent compared to December. Building permits compared to January 2007 were down by 24.6 percent which had seen an annual rate of 1,566,000. Single-family permits in January totaled 673,000 which was 4.1 percent less than December. Housing completions edged up by 1.8 percent in January to an annual rate of 1,351,000 compared to December but were also down by 26.2 percent from January 2007.

Tags: cpi, inflation, housing starts, building permits, housing completions, consumer price index

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