New home starts in the U.S. jumped significantly in May, increasing 6.8% from the month before.

A new Commerce Department report places the annual rate at 914,000, an increase from an upwardly revised April figure of 856,000. Despite the hike, the May rate was a little less than some analysts were expecting, but is nearly 29% higher than the level from May of 2012.

While single-family home starts increased only 0.3% in May after falling for two straight months, the number of building permits issues for such construction increased 1.3% to an annual rate of 622,000, the best level in five years. Permits for multi-family units rose nearly 22%

Also on Tuesday the Labor Department released a report showing inflation is in check with consumer prices in May increasing only 0.1% from April. A decline in food prices helped offset a hike in energy prices.

Over the past 12 months consumer prices have increased 1.4%, however when the volatile food and energy sectors are removed the rate is slightly higher at 1.7%

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