Monday, October 02, 2017

Construction Spending increased in August

by Bill McBride on 10/02/2017 11:06:00 AM

Earlier today, the Census Bureau reported that overall construction spending increased in August:

Construction spending during August 2017 was estimated at a seasonally adjusted annual rate of $1,218.3 billion, 0.5 percent above the revised July estimate of $1,212.3 billion. The August figure is 2.5 percent above the August 2016 estimate of $1,189.1 billion.
Private and public spending both increased in August:
Spending on private construction was at a seasonally adjusted annual rate of $954.8 billion, 0.4 percent above the revised July estimate of $950.5 billion. ...

In August, the estimated seasonally adjusted annual rate of public construction spending was $263.5 billion, 0.7 percent above the revised July estimate of $261.7 billion.
emphasis added
Construction Spending Click on graph for larger image.

This graph shows private residential and nonresidential construction spending, and public spending, since 1993. Note: nominal dollars, not inflation adjusted.

Private residential spending has been increasing, but is still 23% below the bubble peak.

Non-residential spending is now 5% above the previous peak in January 2008 (nominal dollars).

Public construction spending is now 19% below the peak in March 2009, and only slightly above the austerity low in February 2014.

Year-over-year Construction SpendingThe second graph shows the year-over-year change in construction spending.

On a year-over-year basis, private residential construction spending is up 12%. Non-residential spending is down 2% year-over-year. Public spending is down 5% year-over-year.

This was above the consensus forecast of a 0.3% increase for August, and spending for previous months were revised up slightly. A solid report.