Construction Spending Stronger Than Expected
Construction spending grew by 1.1% to $971B in October and reached its highest level since May, the Commerce Department announced today. A 19.3% boost in federal spending led to a 2.3% spike in public construction, while private construction improved by 0.6%. Additionally, June, July, August and September levels all saw upward revisions. Analysts took the news as reason for increased optimism about GDP, with JPMorgan strategists telling Market News International that the report alleviated "some of the downside risk to our forecast for 2.5% real GDP growth in the fourth quarter."
A Retuers poll of economists had predicted a 0.6% October construction spending rise. Still, for the year through October spending is up just 3.3%, an anemic growth rate.