Key Takeaways:
- Construction spending rose 0.4% to $2.172 trillion annualized in April
- The reading beat the 0.3% consensus estimate from economists
- March's figure was revised to $2.165 trillion from the prior reading
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US construction spending rises 0.4% in April, topping estimates
US construction spending accelerated more than expected in April, rising 0.4% to a seasonally adjusted annual rate of $2.172 trillion, Commerce Department data showed Monday.
"The construction sector continues to grind higher at a modest pace, supported by nonresidential projects that are still working through large backlogs," said James Okafor, macro analyst at Edgen.
The reading topped the 0.3% median estimate in a Wall Street Journal survey of economists. March's pace was revised to $2.165 trillion from the previously reported figure. On a year-over-year basis, construction spending was up 3.8% from April 2025.
Residential spending rose 0.3% in April, while nonresidential outlays — which include manufacturing plants, office buildings and highways — increased 0.5%. Private-sector spending gained 0.3%, and public-sector construction climbed 0.7%.
The steady but unspectacular pace of construction activity reflects an economy where elevated borrowing costs continue to weigh on housing, even as federal infrastructure and manufacturing incentives sustain nonresidential work. The Federal Reserve's benchmark rate, held at 4.25%-4.50% since March, has kept mortgage rates near 7%, limiting the recovery in homebuilding.
The next Fed meeting is scheduled for June 17-18, where swaps markets currently price a 78% probability of no change, according to CME FedWatch data.
This article is for informational purposes only and does not constitute investment advice.
