Monday, July 02, 2018

Construction Spending increased 0.4% in May

by Bill McBride on 7/02/2018 11:58:00 AM

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

Construction spending during May 2018 was estimated at a seasonally adjusted annual rate of $1,309.5 billion, 0.4 percent above the revised April estimate of $1,304.5 billion. The May figure is 4.5 percent above the May 2017 estimate of $1,253.6 billion.
Both Private and public spending increased:
Spending on private construction was at a seasonally adjusted annual rate of $1,005.4 billion, 0.3 percent above the revised April estimate of $1,002.3 billion. ...

In May, the estimated seasonally adjusted annual rate of public construction spending was $304.1 billion, 0.7 percent above the revised April estimate of $302.1 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 18% below the bubble peak.

Non-residential spending is 9% above the previous peak in January 2008 (nominal dollars).

Public construction spending is now 7% below the peak in March 2009, and 16% 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 7%. Non-residential spending is up 2% year-over-year. Public spending is up 5% year-over-year.

This was below the consensus forecast of a 0.6% increase for May.