[Asia Economy New York=Correspondent Baek Jong-min] The economic indicators released on the 17th (local time) in the United States showed that the real estate market's strength was more prominent than the industrial sector.
The U.S. Federal Reserve (Fed) announced that industrial production in December last year decreased by 0.3% compared to the previous month. Industrial production, which had escaped the decline seen in September-October last year and unexpectedly increased by 0.8% in November, slowed down again but met market expectations. Experts had predicted a 0.3% decrease. Compared to the same month of the previous year, it decreased by 1.0%.
Manufacturing production, which accounts for most of industrial production, increased by only 0.2% in December, showing a smaller increase than the previous month (1.0%), but the continued upward trend was positive.
The number of new housing starts in December last year, announced by the Department of Commerce, was 1,608,000 units, a sharp increase of 16.9% compared to the previous month. In terms of growth rate, it was the highest since October 2016 and significantly exceeded the market expectation of 1,380,000 units. Compared to the same period last year, it increased by 40.8%, and on an annual basis last year, it rose by 3.2% compared to the previous year.
In a labor market that is performing well, wage increases and mortgage rates at their lowest level in three years are identified as factors driving demand for new homes. Due to the Fed lowering interest rates three times last year, the 30-year fixed mortgage rate fell from 4.94% in November 2018 to 3.65%.
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