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After reporting a steep drop in new U.S. residential construction in the previous month, the Commerce Department released a report on Thursday showing that housing starts showed a significant rebound in the month of December.

The Commerce Department said housing starts jumped by 11.3 percent to an annual rate of 1.226 million in December from the revised November rate of 1.102 million.

Economists had expected housing starts to rise to an annual rate of 1.200 million from the 1.090 million originally reported for the previous month.

Meanwhile, the report said building permits, an indicator of future housing demand, edged down by 0.2 percent to a rate of 1.210 million in December from 1.212 million in November.

Building permits had been expected to rise to 1.230 million from the 1.201 million originally reported for the previous month.