March Construction Spending Unexpectedly Declined by 0.9%

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Construction spending declined 0.9% in March and revisions in February were negative.

The Monthly Construction Spending Report for March was much worse than expected.

Total Construction

  • Construction spending during March 2019 was estimated at a seasonally adjusted annual rate of $1,282.2 billion, 0.9 percent below the revised February estimate of $1,293.3 billion.
  • The March figure is 0.8 percent below the March 2018 estimate of $1,293.1 billion.
  • During the first three months of this year, construction spending amounted to $277.7 billion, 0.2 percent below the $278.3 billion for the same period in 2018.

Private Construction

  • Spending on private construction was at a seasonally adjusted annual rate of $961.5 billion, 0.7 percent below the revised February estimate of $968.6 billion.
  • Residential construction was at a seasonally adjusted annual rate of $500.9 billion in March, 1.8 percent below the revised February estimate of $510.1 billion.
  • Nonresidential construction was at a seasonally adjusted annual rate of $460.6 billion in March, 0.5 percent above the revised February estimate of $458.5 billion.

Public Construction

  • In March, the estimated seasonally adjusted annual rate of public construction spending was $320.7 billion, 1.3 percent below the revised February estimate of $324.7 billion.
  • Educational construction was at a seasonally adjusted annual rate of $76.6 billion, 1.5 percent below the revised February estimate of $77.8 billion.
  • Highway construction was at a seasonally adjusted annual rate of $104.5 billion, 1.9 percent below the revised February estimate of $106.5 billion.

The Econoday economists' consensus estimate was for a 0.2% rise.

Revisions took February from +1.0% to +0.7% so economists effectively missed the mark by 1 whopping 1.5 percentage points.

Not the falloff in residential construction, down 1.8% from February. Housing is still weak despite lower interest rates.

These numbers will subtract from the second estimate of first-quarter GDP.

Mike "Mish" Shedlock

Comments (4)
No. 1-4
Bam_Man
Bam_Man

Obviously this is bullish.

Realist
Realist

As expected, first quarter gdp estimates were probably too high and would come back down a bit. But not to worry. Once Trump gets the fed to lower rates by 1% and resume QE, the economy might get to 3% growth.

lol
lol

Only construction goin on now is...you guessed it......GOV'T,lots of new prison construction,military,homeless shelters,other than that a few dollar stores,not much else.Soaring costs for steel,cement,lumber killin demand in the new hyper stagflation economy,Trump's reelection is in trouble big time and he knows it.

Casual_Observer
Casual_Observer

Nothing the $2T of pork barrel infrastructure spending won't solve along with lower rates. It is probably only a matter of years before rates go negative in the US. All that sideline cash will be unleashed one way or another.