Residential Construction Fell 1.1% and Manufacturing Down to 3-Year Low
Residential construction was at a seasonally adjusted annual rate of $610.0 billion in September, 1.1% below the revised August estimate of $617.0 billion. Housing activity fell for a sixth straight month, the longest such stretch six monthly declines in a row since the first half of 1995.
Nonresidential construction was at a seasonally adjusted annual rate of $312.7 billion in September, 0.1% above the revised August estimate of $312.3 billion. Spending on total private construction was at a seasonally adjusted annual rate of $922.7 billion, 0.7% below the revised August estimate of $929.4 billion.
ISM Manufacturing Index:
The nation's manufacturing sector expanded at its slowest clip in more than three years in October, accroding to The Institute for Supply Management. Economists said housing sector weakness is a big reason for the slowdown.
The ISM manufacturing index registered 51.2 in October, below September's reading of 52.9. It was the index's lowest level since June 2003 and reflected persistently high raw material prices and a decline in new orders, according to data provided by purchasing and supply executives. A reading of 50 or more indicates expansion, while below 50 shows contraction. The October figure represented the 41st consecutive month of growth.
Global Insight industrial economist Tom Runiewicz said the manufacturing sector is likely to experience much slower growth in 2007, perhaps 2.5% on an annualized basis, compared with an estimated 5.2% in 2006.
The ISM's new orders index fell to 52.1 in October from 54.2 in September, while the production index slipped to 51.9 from 56.1.