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Construction spending rises less than expected in September
[WASHINGTON] US construction spending increased less than expected in September as gains in investment in private-sector projects were partially offset by a decline in public outlays.
The Commerce Department said on Monday that construction spending rose 0.3 per cent in September. Data for August was revised down to show construction outlays advancing 0.8 per cent instead of surging 1.4 per cent as previously reported.
Economists polled by Reuters had forecast construction spending rising 1.0 per cent in September. Construction spending increased 1.5 per cent on a year-on-year basis.
Spending on private construction projects increased 0.9 per cent, fuelled by investment in homebuilding amid record-low mortgage rates and a pandemic-driven migration to suburbs and low density areas. Spending on residential projects increased 2.8 per cent.
Outlays on nonresidential construction like gas and oil well drilling dropped 1.5 per cent in September. The pandemic has crushed oil prices, resulting in spending on nonresidential structures contracting in the third quarter. The fourth straight quarterly decline in spending on nonresidential structures bucked a rebound in overall business investment.
Spending on public construction projects declined 1.7 per cent in September.