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Economy in Brief

U.S. Construction Spending Trend Is Strong
by Tom Moeller  August 3, 2015

The value of construction put-in-place ticked 0.1% higher during June (12.3% y/y) following gains of 1.8% and 3.8% during the prior two months. These were much stronger than reported earlier. Three-month growth of 25.2% (AR) was nearly the strongest on record. A 0.6% June rise had been expected in the Action Economics Forecast Survey.

Building activity in the private sector declined 0.5% following a 1.7% May increase, revised from 0.9%. Activity increased at a 21.7% rate during the last three months. Nonresidential construction activity declined 1.3% (+15.2% y/y) following three months of strong increase. Residential building activity rose 0.4% (12.9% y/y) after firmer gains in the prior two months. Multi-family construction improved 2.8% (24.7% y/y), the fourth month in five of strong increase. Spending on improvements improved 0.7% (8.9% y/y) after gains of 1.4% and 5.5% in the prior two months. Single-family building fell 0.3% (+4.8% y/y) after two months of moderate improvement.

Public sector building gained 1.6% (8.4% y/y) and rose by one-third at an annual rate during the last three months. Public safety construction grew 2.8% (-3.9% y/y). Water supply spending grew 13.3% (14.4% y/y) while highway & street construction increased 1.2% (15.2% y/y). Office construction fell 3.8% (10.1% y/y) but educational building improved 0.2% (3.5% y/y).

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

Construction Put in Place (SA, s%) Jun May Apr Jun Y/Y 2014 2013 2012
Total 0.1 1.8 3.8 12.3 4.8 6.6 9.2
  Private -0.5 1.7 3.8 14.0 6.0 11.3 15.9
    Residential 0.4 0.9 2.6 12.9 1.0 19.5 14.9
    Nonresidential -1.3 2.5 4.9 15.2 11.3 3.6 16.9
  Public 1.6 2.1 3.9 8.4 1.9 -3.1 -2.5
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