by Bill McBride on 4/10/2017 03:25:00 PM
Monday, April 10, 2017
Note: This index is a leading indicator for new non-residential Commercial Real Estate (CRE) investment, except manufacturing.
From Dodge Data Analytics: Dodge Momentum Index Springs Forward in March
The Dodge Momentum Index increased by 0.9% in March to 144.4 (2000=100) from its revised February reading of 143.2. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The Momentum Index has now risen for six consecutive months, with much of the gain being driven by institutional projects entering planning while commercial projects so far in 2017 have receded slightly. The institutional portion of the Momentum Index rose 3.7% in March, and is 23.0% higher than the end of 2016. Commercial planning meanwhile fell 1.2% in March and is down 2.9% from December 2016. However, the overall Momentum Index, as well as the commercial and institutional components, are well above their year-ago levels. This continues to signal the potential for increased construction activity in 2017 despite the short-term setbacks that are inherent in the volatile month-to-month planning data.Click on graph for larger image.
This graph shows the Dodge Momentum Index since 2002. The index was at 144.4 in March, up from 143.2 in February.
According to Dodge, this index leads "construction spending for nonresidential buildings by a full year". This suggests further increases in CRE spending over the next year.
Posted by Bill McBride on 4/10/2017 03:25:00 PM