Your Economy (No Politics)

[Bullwinkle]

Construction spending up 1 percent
Wed Feb 1, 10:30 AM ET


WASHINGTON (Reuters) - U.S. construction spending rose a stronger-than-expected 1 percent in December, closing out a record year on a robust note as homebuilding activity bounced back from a weak November, a government report on Wednesday showed.

Construction spending increased to a seasonally adjusted annual rate of $1.161 trillion, an all-time high, from an upwardly revised $1.149 trillion in November, the Commerce Department said.

December's strength brought construction spending for the full year to a record $1.120 trillion, an 8.9 percent increase from 2004.

The report was much stronger than economists had anticipated. Wall Street forecasters had expected construction spending to rise just 0.2 percent. In addition, November's figure was revised up to 0.5 percent gain from an originally reported 0.2 percent increase.

Private construction spending rose 1.1 percent to a record $904.3 billion. Private residential construction, which was flat in November, increased 1 percent, and nonresidential building gained 1.3 percent.

The rise in private spending on homebuilding, which pushed it to a record level, comes against a backdrop of other signs that point to cooling in a five-year U.S. housing boom. For instance, the department said last month that U.S. housing starts fell 8.9 percent in December.

Public construction spending climbed 0.7 percent in December to an all-time high of $256.3 billion.

http://news.yahoo.com/s/nm/20060201/bs_nm/economy_construction_dc_3