Construction Spending in U.S. Unexpectedly Increased in August

Construction spending in the U.S. unexpectedly rebounded in August, propelled by the biggest jump in state and local government outlays in more than two years.

The 1.4 percent gain reversed the revised 1.4 percent drop in July, Commerce Department figures showed today in Washington. The median estimate of 52 economists surveyed by Bloomberg News called for a 0.2 percent decline. The industry was up 1.4 percent from August 2010 before adjusting for seasonal variations, the first positive reading this year.

Increased building of multifamily residences, like apartments and townhouses, adds to evidence that Americans are moving away from home buying in favor of renting. Even with the gain in state and local spending in August, public construction was down 5.3 percent from a year earlier, showing the pain caused by budget cuts.

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- Posted: 2011-10-03 12:18:29

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