An index measuring Australian building activity rose in May to the highest in a year, adding to signs that interest rates at a half-century low and government grants are spurring demand for new homes.

The index gained 10.4 points from April to 46.9, according to a survey by the Australian Industry Group and Housing Industry Association released in Sydney today. That marked the 15th consecutive monthly reading below 50, which shows the building industry is contracting.

bloomberg.com