WASHINGTON (AP) -- Builders cut back on construction spending in January by the largest amount in nine months, with weakness stemming from the biggest reduction in government activity in nearly 15 years.
Construction spending fell 1 percent in January, the Commerce Department reported Wednesday. It was the first decline since September and the biggest drop since a 2.9 percent dip in April.
Spending on government projects tumbled 5 percent, the largest one-month drop since March 2002.
President Donald Trump wants to sharply increase spending on government infrastructure projects over the next decade. But his proposal is expected to face hurdles winning approval in Congress at a time of rising budget deficits.
For January, spending by the federal government on construction projects was down 7.4 percent, while spending by state and local governments fell 4.8 percent. The overall decline in government spending pushed total activity in the category down to a seasonally adjusted annual rate of $268.7 billion, the lowest level since last March.
Residential construction showed a modest gain, while private nonresidential activity was flat.
The 1 percent fall in total construction spending followed a tiny 0.1 percent rise in December and left total activity at an annual rate of $1.18 trillion, 3.1 percent higher than a year ago.
Economists believe that construction activity should provide support for overall economic growth this year, driven by continued strength in housing construction.