Construction Spending Disappoints, Could Detract in 2Q GDP Revisions
Aug 1, 2017
June’s construction spending data was much weaker than expected and a slight positive revision to May’s data was offset by a much larger negative revision to April’s results. The net effect could be a modest negative revision to 2Q growth in the first revision to last Friday’s advance GDP release. Within the details of the report, the biggest drop occurred in public construction spending which fell 5.4% from May. Private construction spending also fell as a 0.2% decline in residential investment offset a 0.1% improvement in the non-residential category. As we have seen in the housing starts and building permits data, multifamily activity drove the disappointment in private residential spending and offset a modest gain in spending on single family residences.