The dollar value of construction put in place is down 0.4 percent in April from March. This is below the consensus of up 0.4 percent in the Econoday survey of forecasters. Total construction spending is down for the third month in a row. The total is down 0.5 percent compared to a year ago. On a year-over-year basis, spending on new construction has been steadily declining since a near-term peak at up 9.8 percent in January 2024.

April construction spending is down 0.9 percent for residential spending, declining for the third consecutive month. Spending on non-residential construction is down 0.1 percent in April and down for a second month.

Private residential construction spending is down 0.9 percent in April, less weak than the decreases of 1.2 percent in March and 2.0 percent in February. This sector has been the mainstay of new construction spending in the last two or three years and its softening will drag down overall construction spending. Spending on new single-family homes falls 1.4 percent in Aprill as homebuilders react to uncertain conditions while buyer traffic is down, and costs for materials and labor are trending up. Spending on multi-unit projects is down 0.1 percent in April. Spending on home renovation and repair total private residential construction less single- and multi-unit building is down 0.5 percent in April as homeowners pause plans while worried about an economic downturn and job security. This subset accounts for 39 percent of spending on private homes.

Total private construction spending is down 0.7 percent in April, while public construction spending is up 0.4 percent. In public construction, spending on some of the largest categories is higher. In particular, spending on highways and streets which account for about 30 percent of the April total -- is up 0.5 percent.

The consensus looks for a rebound of 0.4 percent in April after a 0.5 percent decrease in March.

The dollar value of new construction activity on residential, non-residential, and public projects. Data are available in nominal and real (inflation-adjusted) dollars.

Construction spending has a direct bearing on stocks, bonds and commodities because it is a part of the economy that is affected by interest rates, business cash flow and even federal fiscal policy. In a more specific sense, trends in the construction data carry valuable clues for the stocks of home builders and large-scale construction contractors. Commodity prices such as lumber are also very sensitive to housing industry trends.

Businesses only put money into the construction of new factories or offices when they are confident that demand is strong enough to justify the expansion. The same goes for individuals making the investment in a home.

A portion of construction spending is related to government projects such as education buildings as well a highways and streets. While investors are more concerned with private construction spending, the government projects put money in the hands of laborers who then have more money to spend on goods and services.

On a technical note, construction outlays for private residential, private nonresidential, and government are key inputs into three components of GDP--residential investment, nonresidential structures investment, and the structures portion of government expenditures.

That is why construction spending is a good indicator of the economy's momentum.