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Analysts at Nomura offered their outlook for the key data ahead  from the US.

Key Quotes:

Housing starts: Housing starts increased strongly by 9.2% m-o-m to an annualized pace of 1282k in August, above expectations (Nomura: 1210k, Consensus: 1238k). The starts in July and June were revised up, implying stronger residential investment growth in Q3. The surge in housing starts in August is unlikely to be sustained, as much of this increase came from volatile multifamily housing starts and the underlying pace of singlefamily housing starts has not shown any signs of material acceleration.

In addition, the landfall of Hurricane Florence in North Carolina and South Carolina could lower the housing starts in September which would revert in following month as reconstruction activity picks up. Multifamily housing starts jumped 29.3% m-o-m in August after falling 3.7% in July. The sharp gain in August could revert in the following months. Single-family housing starts increased a steady 1.9% m-o-m in August following a 1.1% gain in July, indicating continued modest improvement in residential construction.

Currently, we do not see signs of material acceleration in single-family housing starts given the significant supplyrelated challenges. Moreover, building permits for August fell 5.7% m-o-m to 1229k, below expectations (Nomura: 1305k, Consensus: 1310k), suggesting that housing starts could slow in following months.

GDP tracking update:

Strong August housing starts and some upward revisions to the previous months imply better residential investment growth in Q3. However, after rounding, our real GDP tracking estimate for Q3 remains unchanged at 3.4% q-o-q saar.