Construction spending for May 2019
US construction spending came in weaker than expected at -0.8% versus 0.0% estimate. The decline was partially offset by a revision higher in the previous month. In April construction spending rose 0.4% versus 0.0% previously reported.
- private construction spending -0.7%
- public spending, -0.9%
- THe private construction projects dropped to its lowest level in nearly 2 1/2 years (January 2017). Private construction fell -1.0% in April (and also fell in March).
- Private residential construction have now declined for 5 straight months
- spending on private nonresidential structures, which includes manufacturing power plants, fell by -0.9% after a 1.4% decline in April.
- The fall this month was the largest since last November
- public construction spending surged in the 1st quarter on the back of increase investment in roads and highways by state and local governments
- public construction gave back some of its 4.5% surge in April
- outlays on federal government construction fell -5.2% in May after an oversized 7.3% gain in April
The falls - especially in private construction - is a concern especially since employment gains remain robust and interest rates have dropped sharply from last year's high levels. According to the Commerce Department spending on residential construction has now contracted for 5 straight quarters.
