October Construction Spending Jumps 0.8%; September Down 0.3%

WASHINGTON — Construction spending rose 0.8% in October following a 0.3% drop in September, with a sharp rise in public construction offsetting declines in private building, data released by the Commerce Department Monday morning showed.

Analysts in an MNI survey expected October construction spending to rise 0.5%. This was also the first release of the September data.

Public construction jumped 3.9% in October following a 1.9% decline in the previous month with State and Local Government spending up 3.2%.

A much smaller portion of public construction, Federal Government construction, jumped 10.9% in the month following sharp declines in the previous two months. Some analysts expected the Federal Government shutdown in October to affect building in that sector, and in fact unadjusted Federal Government construction fell 28.3% in the month. However, seasonal adjustment factors appear to have expected an even larger decline as cooler weather approached.

Private residential spending fell 0.6% led by a 0.6% decline in single-family construction, offset by a 2.2% rise in the construction of multi-family homes. Residential construction excluding new homes, which captures home remodeling, fell 1.2% after rising 3.6% in September.

Nonresidential private construction fell 0.5% on a 5.7% decline in the large power category as well as declines in the communications and amusement sectors.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.

For reprint and licensing requests for this article, click here.
MORE FROM BOND BUYER