Construction spending fell more than expected in October, led lower by declines in both residential and nonresidential buildings. October’s 0.8% slide was steeper than the consensus compiled by Econoday for a 0.4% gain and finished at a seasonally adjusted annual rate of $1.291 trillion, under the revised September estimate of $1.302 trillion. October’s result was 1.1% above the $1.277 trillion in the same month of 2018.
The bureau said private construction in October was $956.3 billion, 1% under September’s revised print of $966.1 billion.
Residential construction slid 0.9% to $508.2 billion in October from September’s revised reading of $512.6 billion. New single-family residential construction rose 1.6% to $279.1 billion while multifamily construction fell 1.6% to $59.47 billion.
Nonresidential construction fell 0.7% to $776.53 billion in October from the revised print of $782.32 billion the month before.
“The drop in construction spending was led by a second straight decline in both residential and nonresidential spending, so scratch the expected improvement in nonresidential structures investment in Q4,” said BMO Capital Markets Senior Economist Sal Guateri.
Meanwhile, public construction in October edged 0.2% lower to $334.8 billion from $335.6 billion. Educational construction was $83.3 billion, 2.5% above September’s revised $81.3 billion. Highway construction was $95 billion, 2.2% under the previous month’s revised $97.1 billion estimate.