DALLAS — Continental Airlines made a surprising profit in the fourth quarter thanks to higher traffic and a lower fuel bill.

Continental said Thursday that it earned $85 million in the quarter.

Without some special items, including an income tax gain, the company would have earned $4 million, or 3 cents per share. Analysts expected a loss of 7 cents per share.

Houston-based Continental boosted passenger traffic by 3.5 percent in the quarter. But revenue fell because of a decline in high-paying customers.

In recent weeks, Continental joined other airlines in raising fees on checked baggage to make up for some of the decline in ticket revenue.

WASHINGTON — The government Wednesday said buyers will face higher fees and tougher standards for home loans backed by the Federal Housing Administration, a popular source of loans for first-time buyers.And unemployment is expected to remain high throughout the year, which will drive the foreclosure rate to new records.Construction of new homes and apartments fell 4 percent in December to a seasonally adjusted annual rate of 557,000 from an upwardly revised 580,000 in November, the Commerce Department said. Applications for future projects, however, increased strongly as the industry ramps up for the spring selling season.