U.S. construction spending rises, boosted by housing sector
WASHINGTON (Reuters) - U.S. construction spending rose more than expected in November and builders also spent more in earlier months than previously estimated, a sign the housing sector was giving some support to economic growth.
The Commerce Department said on Friday that construction spending increased 0.6% in November, beating analysts' consensus forecast of a 0.3% gain.
Data for October and September was revised to show increases in spending, a reversal from previous estimates of contractions in spending during those months.
The gain in November was driven by a 1.9% increase in private home-building, an indication the Federal Reserve's interest rate cuts last year, which drove mortgage rates lower, were boosting the economy.
The Fed cut rates three times in 2019, softening the hit on the economy from a trade war between the United States and China, as well as slowing global growth. Weakness in the U.S. manufacturing sector has dragged on the economy in recent months.
In November, spending on private non-residential structures, which includes manufacturing and power plants, dropped for the third straight month, falling 1.2% to the lowest level since November 2018.
Spending on public construction projects rose 0.9% in November. Spending on state and local government construction projects increased 0.8%. Outlays on federal government construction projects - which are only a sliver of overall public construction spending - increased 1.7%.
(Reporting by Jason Lange Editing by Paul Simao)
