US house prices fell by a record annual amount in the final three months of last year, two housing indexes showed today.

Wall Street rose sharply today as investors grew more confident that the Federal Reserve will lower interest rates next week, even after its chairman gave no clues about the central bank’s intentions.

Prime Minister John Howard today insisted that he and Treasurer Peter Costello were still a team, despite an apparent leadership tussle that could undermine a decade of economic growth in Australia.