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Last Updated: Wednesday, 16 May 2007, 14:05 GMT 15:05 UK
US home construction accelerates
US estate agent sign
US house building picked up pace in April, topping market forecasts.

During the month, 1.528 million new homes were built on an annualised rate, up from 1.491 million in March.

However, analysts warned that the outlook for the construction industry may not be rosy, underlining fears that the housing market may be softening.

Building permits - a measure of future construction plans - were increasing at their slowest pace in a decade, the Commerce Department said in its report.

Housing construction is now 26% lower than at the same time last year.

The worry is that a slump in the housing market will feed through into the wider economy, causing consumers to rein in their spending and hurting corporate profits.

On Tuesday a survey by the National Association of Home Builders showed that a sentiment index gauging the mood of the building industry had fallen to its lowest level since September last year.

Industrial output

Separate figures released by the US Federal Reserve showed that industrial output increased by more than expected in April compared with the previous month.

April's 0.7% rise came after industrial output had dropped by 0.3% in March.

Autos, computers and electronic equipment saw some of the biggest increases for the month.

Meanwhile utilities saw output climb 3.5% after an unusually cold April pushed up demand for domestic heating.

The US industrial sector comprises manufacturing, mining, electric and gas utilities.


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