Housing starts and building permits came in higher than expected. Starts in May gained 17.2% month-over-month to an annual rate of 532,000, topping the estimate of 485,000. Building permits also increased 4.0% m/m to an annual rate of 518,000, above the forecast of 508,000.
The Producer Price Index, a key gauge of inflation at the wholesale level—increased 0.2% m/m in May, less than an expected reading of 0.6%. The core rate, which removes food and energy, fell 0.1%, versus the consensus estimate of a rise of 0.1%. Year-over-year the headline rate is down 5.0%, and the core rate dipped lower from 3.4% y/y to 3.0%.
Industrial production fell 1.1% in May, slightly worse than the estimated decline of 1.0%. Capacity utilization continued to decline, and was a record low 68.3%, lower than the expected 68.4%. April utilization was revised lower to 69.0%.
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