The US Commerce Department reported on Tuesday that housing starts dipped 3.3 percent in May. This was the lowest level in more than 17 years. This signals a worsening U.S. housing sector.

The housing construction starts set an annual pace of 975,000 units in May, the lowest since March 1991. Economists were expecting a 980,000 unit rate before the information was reported. The April starts figure was revised downward to 1.008 million from the 1.032 million originally reported.

U.S. stock futures remained positive after the release of housing data and a separate report on the producer price index, which was higher than expected. The U.S. dollar slipped and Treasuries held gains after the data was released.

Building permits dropped to an annual rate of 969,000, slightly higher than the 960,000 rate expected by economists.

The housing market has been battered for months by increasing foreclosure rate, failing mortgages and uncertainty of when the sector will recover. Nationwide, there are some mixed signals about the health of the housing sector.