US housing market picks up, inflation pressures muted

[WASHINGTON] US housing starts rebounded strongly in July, pointing to momentum in the economy, but a moderate increase in consumer prices suggested the Federal Reserve has room to keep interest rates low for a while.

Groundbreaking surged 15.7 per cent last month to a seasonally adjusted annual 1.09-million unit pace, the Commerce Department said yesterday, snapping two straight months of declines.

Economists had forecast starts to rise to a 969,000-unit rate in July.