UPDATE 1-Freddie Mac's portfolio grows 3.8 pct in May

(Reuters) - For the year to date, the portfolio has expanded by 2.6
percent after falling by 0.9 percent in 2006 to end the year at
about $704 billion.




The company is growing within the constraints of a
voluntary agreement with its regulator, the Office of Federal
Housing Enterprise Oversight, to limit the expansion of its
mortgage holdings while emerging from an accounting crisis.


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Housing Starts in U.S. Probably Fell in May, Prolonging Slump, Survey Says

(Bloomberg) -- Housing starts in the U.S. probably
fell in May, signaling the slump in home construction will
continue to depress growth, economists said before a government
report today.

Builders broke ground on new houses at an annual rate of
1.473 million in May, down 3.6 percent from 1.528 million the
prior month, according to the median forecast of 68 economists
surveyed by Bloomberg News. Building permits probably rose to
1.47 million from a nine-year low 1.457 million in April.


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Raines Says Fannie Mae Regulator Hides Details in Accounting Investigation

(Bloomberg) -- Franklin Raines, ousted as chief
executive officer of Fannie Mae in 2004, said regulators are
withholding documents that may show a deliberate attempt to drive
down the company's stock price.

The Office of Federal Housing Enterprise Oversight
``continues to guard jealously against the disclosure of
information,'' Raines said in a filing yesterday with the U.S.
District Court in Washington. Ofheo is denying access
``presumably for fear that the integrity of its own public
statements will be called into serious question,'' the filing
said.


Read more at Bloomberg Bonds News