US: Weak construction spending numbers – Nomura

Analysts at Nomura note that the US construction expenditure came in weaker than expected, rising a modest 0.1% m-o-m in August (Consensus: +0.4%) with a downward revision to the previous month.

Key Quotes

“In details, construction activity in the private sector slowed further in August as private construction spending fell by 0.5% m-o-m, the third consecutive months of declines. Private residential construction continued to fall by 0.7%, consistent with the recent softening of building permits and starts. Moreover, private non-residential construction, the other subcomponent of private construction spending, showed another decline of 0.2% m-o-m.”

“In contrast, public sector construction spending remained strong, up 2.0% m-o-m in August, following 1.7% in the previous month. On a y-o-y basis, public construction spending increased 14.0%.”