U.S. Construction Spending Unexpectedly Edges Lower In October

With a drop in spending on private construction more than offsetting an increase in spending on public construction, the Commerce Department released a report on Monday showing an unexpected dip in U.S. construction spending in the month of October.

The Commerce Department said construction spending edged down by 0.1 percent to an annual rate of $1.309 trillion in October after slipping by 0.1 percent to a downwardly revised rate of $1.311 trillion in September.

The modest decrease came as surprise to economists, who had expected construction spending to rise by 0.3 percent compared to the nearly unchanged reading originally reported for the previous month.

The unexpected decrease in total construction spending came as spending on private construction fell by 0.4 percent to a rate of $998.7 billion in October after rising by 0.4 percent to a revised rate of $1.003 trillion in September.

Spending on residential construction slid by 0.5 percent to a rate of $539.0 billion, while spending on non-residential construction also dropped by 0.3 percent to a rate of $459.7 billion.

Meanwhile, the report said spending on public construction climbed by 0.8 percent to a rate of $310.2 billion in October after tumbling by 1.5 percent to a revised rate of $307.8 billion in September.

A 2.6 percent spike in spending on educational construction to a rate of $76.9 billion more than offset a 0.1 percent dip in spending on highway construction to a rate of $94.6 billion.

Despite the monthly decrease, the Commerce Department said total construction spending in October was up by 4.9 percent compared to the same month a year ago.