WASHINGTON (Reuters) -U.S. single-family homebuilding and permits for future construction dropped in August amid a glut of unsold new houses and a softening labor market, shrugging off falling mortgage rates.

Single-family housing starts, which account for the bulk of homebuilding, fell 7.0% to a seasonally adjusted annual rate of 890,000 units last month, the Commerce Department’s Census Bureau said on Wednesday. Permits for future single-family homebuilding decreased 2.2% to a rate of 856,000 units.

The rate on the popular 30-year mortgage has dropped to an 11-month low of 6.35% last week from around 7.04% in mid-January, data from mortgage finance agency Freddie Mac showed, as financial markets anticipated the Federal Reserve would resume cutting interest rates this week.

The U.S. ce

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