Is it a momentary pause in the U.S. housing sector's recovery, due to the typical winter slowdown in construction, or the sign of a deeper economic problem?

U.S. housing starts recorded their biggest drop in almost three years in January, likely weighed down by harsh weather, but the third month of declines in permits pointed to some underlying weakness in the housing market, Reuters reported Wednesday.

Meanwhile, other data on Wednesday showed little inflation pressures at the factory gate in January, even as prices for goods rose for a second straight month.

Groundbreaking tumbled 16.0 percent to a seasonally adjusted annual rate of 880,000 units, the lowest level since September, the Commerce Department said. The percentage drop was the largest since February 2011, Reuters reported.

Starts for December were revised up to a 1.05 million-unit pace from the previously reported 999,000.

Economists polled by Reuters had expected starts to fall to 950,000 units in January.