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US construction spending unchanged in July
[WASHINGTON] US construction spending was unexpectedly flat in July as gains in the private sector were offset by steep declines in government outlays, but upward revisions to the prior two months suggested a lift to the second-quarter economic growth estimate.
The Commerce Department said on Thursday that the unchanged reading for construction spending followed a 0.9 per cent rise in June that had previously been reported as a 0.6 per cent decline. In addition, construction spending in May was revised to show a rise of 0.1 per cent instead of a drop of 0.1 per cent.
Construction outlays were up 1.5 per cent from a year ago. Economists polled by Reuters had forecast construction spending rising 0.5 per cent in July.
The upward revisions to the May and June construction spending data could see the second-quarter gross domestic product estimate revised up from the 1.1 per cent annual pace reported last month. The government will publish its third GDP estimate for the second quarter later this month.
In July, private construction spending increased 1.0 per cent, with outlays on residential construction rising 0.3 per cent. Private residential construction spending slipped 0.1 per cent in June.
Spending on private nonresidential structures increased 1.7 per cent in July, the third straight monthly rise.
Public construction spending, however, dropped 3.1 per cent in July, the lowest level since February 2015.
Outlays on state and local government construction projects also fell 3.1 per cent to an almost 1-1/2-year low. Federal government construction spending declined 3.3 per cent.