Recent Updates

  • Indonesia: External Debt (May)
  • US: MTIS (May), Advance Retail Sales (Jun)
  • Jordan: Foreign Reserves (Jun)
  • Existing Home Sales (Jun)
  • US: Empire State Mfg Survey (Jul)
  • Brazil: Economic Activity (May)
  • France: France: Producer Cost Indices for Construction (Apr), Financing Access Survey (Q2)
  • China: NCI Economic Activity Index (Jul)
  • more updates...

Economy in Brief

U.S. Construction Spending Declines M/M As Forward Momentum Eases
by Tom Moeller  November 3, 2014

The value of construction put-in-place edged 0.4% lower (+2.9% y/y) during September following a 0.5% August decline. The 0.3% July rise was revised sharply lower. Since May's peak, the value of construction spending has fallen 2.3%, pulling y/y growth to 2.9% versus its high of 9.8% in January. The latest increase disappointed expectations for a 0.6% rise in the Action Economics Forecast Survey.

Private sector construction outlays slipped 0.1% in September and y/y growth declined to 3.4% from its 2012 high of 16.0%. Nonresidential building fell 0.6% (+6.3% y/y), down for the third month in the last four. It reflected a 3.1% decline (+2.3% y/y) in power plants and a 1.1% drop (-13.6% y/y) in communication facilities. These declines were countered by a 2.2% rise (18.0% y/y) in office construction. Residential building nudged 0.4% higher (0.7% y/y), continuing the significant slowdown in momentum since early-2013. Single-family homebuilding improved 1.1% (9.8% y/y) versus its 35.0% y/y early last year. Multi-family building declined 1.0%. Year-to-year growth of 25.7% was roughly half that of late-2012. Spending on improvements slipped 0.3% and the year-to-year decline of 17.1% compared to the peak of +16.4% y/y early last year.

Forward momentum behind public sector building activity eased as September activity fell 1.3%, down for the third month in the last four. Nevertheless, the value of activity rose 1.7% y/y compared to negative growth extending back to 2009. Government office building is up 6.0% y/y compared to a one-quarter decline last year. Spending on education facilities jumped 8.4% y/y compared to a 9.8% decline last year. Countering these gains was 1.7% y/y decline in spending on highways & streets.

The construction spending figures are in Haver's USECON database and the expectations figure is contained in the AS1REPNA database.

Construction Put in Place (%) Sep Aug Jul Y/Y 2013 2012 2011
Total -0.4 -0.5 0.3 2.9 5.7 9.2 -2.1
  Private -0.1 -0.3 -0.2 3.4 10.1 16.0 -0.1
    Residential 0.4 -0.3 -0.5 0.7 20.4 14.4 1.9
    Nonresidential -0.6 -0.3 0.1 6.3 0.6 17.5 -1.8
  Public -1.3 -1.0 1.6 1.7 -3.5 -2.8 -5.4
close
large image