Econoday Report: Construction Spending 1, 2006

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Construction Spending

Definition
The dollar value of new construction activity on residential, non-residential, and public projects. Data are available in nominal and real (inflation-adjusted) dollars. Why Investors Care

Released on 8/1/06 For Jun 2006

Construction Spending, M/M change
Actual	0.3%
Consensus	0.2%
Consensus Range	-0.5% to 0.7%
Previous	-0.4 %

Highlights
Construction spending rose 0.3 percent in June, following no change in May. June's gain was above the consensus forecast for a 0.2 percent increase. In June, private construction edged up 0.1 percent while public construction posted a 0.8 percent boost. Private residential construction fell 1.0 percent with single-family homes dropping 2.1 percent, following a 1.9 percent decrease in May. Private residential outlays are down 0.1 percent on a year-on-year basis.

Nonresidential construction spending jumped 2.7 percent in June, following a 1.6 percent rise in May. Monthly nonresidential outlays for June were up in all major categories: office, 1.9 percent; commercial, 1.1 percent; manufacturing, 8.1 percent; power, 4.1 percent; and transportation, 1.0 percent. Nonresidential outlays continue on a strong uptrend and are up 21.6 percent from a year ago.

Today's outlays numbers fit most economists' view for the overall economic outlook - easing residential construction combined with still robust nonresidential building.

Market Consensus Before Announcement
Construction spending has been on a dual track as construction spending fell 0.4 percent in May following a revised 0.2 percent decline in April. Residential construction fell 0.8 percent in the latest month. Nonresidential construction spending also slipped 0.3 percent in May but followed healthy gains of 1.6 percent and 2.4 percent for April and March, respectively. The recent trend in housing starts suggests further moderate softening in the residential outlays component.

Construction spending Consensus Forecast for June 06: +0.2 percent
Range: -0.5 to +0.7 percent

Trends

Construction spending has moderated significantly over the past year despite strenth in the housing market. Residential construction is not growing as rapidly as it did even though current levels are high. Nonresidential construction has begun to improve, but gains are still modest.

Data Source: Haver Analytics

2006 Release Schedule

Released On: 1/3 2/1 3/1 4/3 5/1 6/1 7/3 8/1 9/1 10/2 11/1 12/1

Released For: Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct