Construction Spending Declines on Fewer Residential, Commercial Projects

For the first time in a year and a half, construction spending was lower than the previous 🔜month, as builders decreased their budgets on bo🌊th residential and commercial building projects.

The annualized rate of construction spending declined 0.1% from revised April figures, according to the Census Bureau Monday. Economists were expecting a 0.2% bump in May.

Residential construction spending was 0.2% lower than in the month prior, while lower spending on office, health care and religious buildings helped push non-residential construction was 0.3% below last month’s annualized totals. An increase in total public construction, including educational buildings an🦄d highway projects, couldn’t offset the declines in private-sector spending.

Construction projects are being undercut by high borrowing costs from 澳洲幸运5官方开奖结果体ꦫ彩网:interest rates that are at𝔍 elevated levels,  wrote Wells Fargo economists Cha🎀rlie Dougherty and🌞 Jackie Benson.

“Although the construction market as a whole has navigated the higher interest rate environment relatively well thus far, the restrictive effects of tight monetary policy are becoming increasingly apparent across the industry💎,” they wrote. 

Oxford Economics said the data pointed to lower 澳洲幸运5官方开奖结果体彩网:gross domestic product (GDP) numbers for the second quarter.

-Terry Lane

Slow Demand Extends Manufacturing Sector Weakness in June 

The manufacturing sector showed continued weakness in June, with tepid demand, limited output and decreasing confidence among factory and fabrication executives. However, the surveys also indicated manufacturing costs were cooling, providing more data to show that 澳洲幸运5官方开奖结果体彩网:inflation pressures may be easing. 

The 澳洲幸运5官方开奖结果体彩网:Institute of S♍upply Management (ISM) reported a manufacturing 澳洲幸运5官方开奖结果体彩网:Purchasing Managers’ Index (PMI)  of 48.5% in June, 澳洲幸运5官方开奖结果体彩网:below May’s results. It was nearly a full percentage point lower than the increase economists surveyed by the Wall Street Journal and Dow Jones Newswire expected.

It’s the third straight month of declines for the closely 🎉followed index, which has moved lower in 19 of the past 20 months. However, the readi🌸ngs still indicate the broader economy is expanding. 

New order levels still indicated a pullback from customers, while lower exports and backlog orders also demonstrated weakening demand.  High interest rates continue to be a problem for the 澳洲幸运5官方开奖结果体彩网:manufacturing sector, saidꦛ Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committeeღ in a statement.

“Demand 🅘remains subdued, as companies demonstrate an unwillingness to invest in capital and inventory due to current𓆉 monetary policy and other conditions,” Fiore said. 

A separate report from S&P Global Market Intelligence showed little momentum for the sector, as manufacturing business leaders' confidence was at a 19-month low.

“Factories have ไbeen hit over the past two years by demand sw🔯itching post-pandemic from goods to services, while at the same time household and business spending power has been diminished by higher prices and concerns over higher-for-longer interest rates,” said Chris Williamson, S&P Global Market Intelligence chief business economist.

The ISM survey showed the prices paid index declined nearly 5 percentage points to come in at 52.1%, while the supplier pric🌌e increases as measured by the S&P Global PMI also dipped to a three-month low. 

-Terry Lane