Feb. Construction Spending Preview
Feb. Construction Spending is expected to fall after declining 1.7% in Jan. Private residential construction fell 3% in Jan., private non-residential construction fell 1.2% and public construction fell 0.2%.
Private residential construction is expected to resume in decline in Feb. thanks to the continued US housing market fallout. Private residential construction has shown a considerable downtrend since mid ’06 and appears poised to continue falling through the end of the year. Housing starts improved modestly in Feb., which may provide marginal support for private residential construction. Aggregate construction hours fell 1% in Feb. after falling 1.3% in Jan.
Except for the decline in Jan., private non-residential construction has been a consistent addition to the monthly construction figures. While private non-residential construction is expected to maintain its upward path in Feb., softer job growth over the last year may slow the pace of non-residential construction in ’08.
Public construction in expected to rebound in Feb. after falling 0.2% in Jan. and falling 1.6% in Dec. The previous 2 month’s data appear to be mere anomalies in what has come to be a consistently positive addition to monthly construction data. Public construction is likely to continue its positive trend for most of ’08.