October 2018 Headline Construction Spending Slows

The headlines say construction was declined month-over-month and was well below expectations. The rolling averages declined.

Analyst Opinion of Construction Spending

The rolling averagesdeclined - and last month was significantly 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.

 

Econintersect analysis:

  • Growth decelerated 0.3 % month-over-month and up 4.5 % year-over-year.
  • Inflation-adjusted construction spending down 1.5 % year-over-year.
  • 3 month rolling average is 4.9 % above the rolling average one year ago which decelerated 0.5 % 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 significantly downward.

US Census Analysis:

  • Down 0.1 % month-over-month and up 4.9 % (was published 7.2 % last month) year-over-year.
  • Market expected from Econoday +0.2 % to 0.6 % month-over-month (consensus +0.4).

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

This month's headline statement from US Census:

Construction spending during October 2018 was estimated at a seasonally adjusted annual rate of $1,308.8 billion, 0.1 percent (±1.5 percent)* below the revised September estimate of $1,310.8 billion. The October figure is 4.9 percent (±1.6 percent) above the October 2017 estimate of $1,247.5 billion. During the first ten months of this year, construction spending amounted to $1,096.4 billion, 5.1 percent (±1.2 percent) above the $1,043.6 billion for the same period in 2017.

PRIVATE CONSTRUCTION - Spending on private construction was at a seasonally adjusted annual rate of $998.7 billion, 0.4 percent (±0.8 percent)* below the revised September estimate of $1,003.0 billion. Residential construction was at a seasonally adjusted annual rate of $539.0 billion in October, 0.5 percent (±1.3 percent)* below the revised September estimate of $541.7 billion. Nonresidential construction was at a seasonally adjusted annual rate of $459.7 billion in October, 0.3 percent (±0.8 percent)* below the revised September estimate of $461.3 billion.

PUBLIC CONSTRUCTION - In October, the estimated seasonally adjusted annual rate of public construction spending was $310.2 billion, 0.8 percent (±2.6 percent)* above the revised September estimate of $307.8 billion. Educational construction was at a seasonally adjusted annual rate of $76.9 billion, 2.6 percent (±2.3 percent)* above the revised September estimate of $75.0 billion. Highway construction was at a seasonally adjusted annual rate of $94.6 billion, 0.1 percent (±6.9 percent)* below the revised September estimate of $94.6 billion.

1 2
View single page >> |

Disclaimer: No content is to be construed as investment advise and all content is provided for informational purposes only.The reader is solely responsible for determining whether any investment, ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.