US Construction Spending Unexpectedly Declines in January.
U.S. construction spending unexpectedly fell in January, pulled down by a decline in outlays on multi-family homebuilding, with spending on private projects slipping 0.2% and investment in residential construction declining 0.4%, while outlays on new single-family projects rose 0.6%. Higher mortgage rates remain a constraint, exacerbated by looming additional tariffs on lumber and other imports, contributing to an excess supply of unsold houses on the market amid weak demand. The drop in spending is attributed to factors including higher mortgage rates and changes in government policies.
- This decline may signal a slowdown in the construction industry, which could have significant implications for the overall economy and housing market.
- Will increased tariffs on lumber and other imports further exacerbate the existing supply chain issues and worsen the already fragile state of the construction sector?