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U.S. construction spending falls to nine-month low
September 1, 2017 / 2:05 PM / 2 months ago

U.S. construction spending falls to nine-month low

WASHINGTON (Reuters) - U.S. construction spending unexpectedly fell in July, hitting a nine-month low amid a steep decline in investment in private structures.

FILE PHOTO - Apartment buildings are shown under construction in Carlsbad, California, U.S., May 24, 2017. REUTERS/Mike Blake/File Photo

The Commerce Department said on Friday that construction spending decreased 0.6 percent to $1.21 trillion also as investment on public sector projects fell.

That was the lowest level since October 2016 and followed a downwardly revised 1.4 percent tumble in June.

Economists polled by Reuters had forecast construction spending increasing 0.5 percent in July after a previously

reported 1.3 percent drop in June. Construction spending increased 1.8 percent on a year-on-year basis.

In July, spending on private nonresidential structures plunged 1.9 percent to the lowest level since April 2016.

The percent drop was biggest since October 2015 and followed a 1.6 percent fall in June. Investment in residential and nonresidential structures such as oil and gas wells is slowing as the boost from recovering oil prices fades.

As a result, spending on private construction projects fell 0.4 percent in July after slipping 0.5 percent in June. Investment in private residential construction rose 0.8 percent.

Outlays on public construction projects dropped 1.4 percent to their lowest level since February 2014.

That followed a 4.4 percent plunge in June. Spending on state and local government construction projects fell 1.4 percent in July, also dropping to the lowest level since February 2014.

Federal government construction spending declined 1.2 percent to the lowest level since April 2016.

Reporting By Lucia Mutikani; Editing by Andrea Ricci

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