Tuesday, September 3, 2013

Construction Spending Increased 0.6% in July

Construction spending increased 0.6% in July, due largely to continued strength in residential construction. Construction spending grew 5.3% above year ago levels. The report has positive revisions to the previous two months, with an upward revision of 0.7% to May and 0.6% to June, bringing June out of contracting territory.

Residential construction improved 0.6% in July, up from a revised 0.4% in June. Of the three components of residential construction, spending on residential improvements increased the most, rising 0.8% in July. However, spending on new multifamily homes saw the largest increase from July 2012, growing 39.3%. Non-residential construction also increased in July, rising 1.3% and reversing a negative reading from the previous month. The uncertainty of the Federal Reserve’s gradual removal of its quantitative easing purchases will hamper private nonresidential construction’s full recovery.

Public construction spending declined 0.3% in July, reversing the 0.3% positive growth in June.

Read the Census report.

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