Consensus Outlook
Housing starts and permits have been struggling with no improvement the expectation for December. Forecasters see starts coming in at a 1.260 million annualized rate which would would be slightly higher than November's rate. Permits are expected to come in at 1.290 million and well down from November's 1.322 million (since revised to 1.328 million). Single-family data, which are the dominant component in this report, have been especially weak in recent reports in contrast to noticeable acceleration for multi-family units.
Relative Performance Index
Econoday's RPI provides a handy summary measure of how an economy has recently been evolving relative to market expectations.
A reading above zero means that the economy in general has been performing more strongly than expected and vice versa for a reading below zero. The closer is the value to the maximum (+100) or minimum (-100) levels, the greater is the degree to which markets have been under- or over-estimating economic activity.
A zero outturn would imply that, on average, the market consensus has been correct. Note too that the index is sensitized to place extra weight upon those indicators that investors consider to be the most important.
Definition
Housing starts measure the initial construction of single-family and multi-family units on a monthly basis. Data on permits provide indications of future construction. A housing start is registered at the start of construction of a new building intended primarily as a residential building. The start of construction is defined as the beginning of excavation of the foundation for the building. Why Investors Care