Fall in Spending on Construction in the US Impacting Overall Growth
Published By : 01 Apr 2015 | Published By : QYRESEARCH
The spending on construction in the United States dipped in February, numbers reveal. This was mainly brought down by a fall in single family home building.
The spending on seasonally adjusted construction dropped by 0.1 per cent in February following a revised dip of 1.7 per cent in January. This was reported by the Commerce Department on Wednesday.
The result on one hand reflects the conditions of bitter winter weather which restricted construction activities in quite a few parts of the country during the months of January and February. This result is one of many other economic reports, most of which are discouraging. These reports, which include those on jobs and manufacturing, also brought down the stock market on Wednesday. Apart from this, it also raised concerns regarding global growth and corporate profits.
However, despite all this, market analysts are on the whole hopeful about a rebound in spending on construction activities as the economy has been showing signs of strengthening in the spring as well as in the summer.
There are still many economists, such as those at IHS Global Insight, who term February’s figures as yet another poor report. In a research note the analysts stated that the low spending on construction activities was most likely to bring down the overall growth of the economy in the first quarter of this year.
According to the report released on Wednesday, private spending on the construction of single family homes fell by 1.4 per cent which is the sharpest decline since the year 2010. This was noted by head of the United States macroeconomics at Oxford Economics, Gregory Daco. The report also noted that spending on construction of apartments rose by 4.1 per cent.