Tags: manufacturing | real estate | U.S. economy

Home builders are more optimistic than at any time since May of 2007, and output among U.S. manufacturers continued to grow in January.

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Factory production increased 0.7%, the Federal Reserve said, after an upwardly revised 1.5 percent rise in December.

Capacity use in manufacturing rose in January to 77%, its highest since April 2008. A measure of factory activity in New York state rose to its highest level in a year and a half.

Confidence among builders of new single-family homes increased in February for the fifth consecutive month, according to the National Association of Home Builders.

All of these signs point to positive momentum going into 2012, building on a 2.8% annual pace of growth in the overall economy in the fourth quarter of 2011.

Along with improving employment and retail sales numbers, the manufacturing numbers have prompted many analysts to “scale back expectations of a sharp pull-back in first-quarter growth and further monetary easing by the Fed,” Reuters reports.