December 2018 Construction Spending Year-Over-Year Growth Slows

The headlines say construction slowed month-over-month. Our analysis shows the rolling averages declined.

Analyst Opinion of Construction Spending

Note from US Census:

Data collection and processing were delayed for this indicator release due to the lapse in federal funding from December 22, 2018 through January 25, 2019. Processing and data quality were monitored throughout and response rates were consistent with normal levels.

The rolling averages declined - and last month was revised down. Also note that inflation is grabbing hold, and the inflation-adjusted numbers are in contraction.

The employment gains currently are generally correlating with construction spending.

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Econintersect analysis:

  • Growth decelerated 1.3 % month-over-month and up 0.8 % year-over-year.
  • Inflation-adjusted construction spending down 5.0 % year-over-year.
  • 3 month rolling average is 1.9 % above the rolling average one year ago which decelerated 0.7 % month-over-month. As the data is noisy (and has so much backward revision) - the moving averages likely are the best way to view construction spending.
  • Backward revision for the last 3 months was downward.

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US Census Analysis:

  • Down 0.6 % month-over-month and up 1.6 % (was published 3.4 % last month) year-over-year.
  • Market expected from Econoday +0.2 % to 1.0 % month-over-month (consensus +0.6).

Construction spending (unadjusted data) was declining year-over-year for 48 straight months until November 2011. That was four years of headwinds for GDP.

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This month's headline statement from US Census:

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