August 2, 2018

June 2018 Construction Spending: Down 1.1 Percent — But With Revisions Track Record, Who Cares?

Filed under: Economy,Lucid Links,Taxes & Government — Tom @ 1:03 pm

From the Census Bureau (eventual permanent link):

Total Construction

Construction spending during June 2018 was estimated at a seasonally adjusted annual rate of $1,317.2 billion, 1.1 percent (±1.0 percent) below the revised May estimate of $1,332.2 billion. The June figure is 6.1 percent (±1.6 percent) above the June 2017 estimate of $1,241.3 billion. During the first six months of this year, construction spending amounted to $619.9 billion, 5.1 percent (±1.2 percent) above the $589.6 billion for the same period in 2017.

It’s hard to take these initial reports seriously any more because of the Census Bureau’s track record of initial reports being upwardly revised:

ConstSpendingRevsJanToMay2018

The average upward revision this year has been 1.27 percent. If June is revised up by that five-month average, the 1.1 percent seasonally adjusted decline from May reported today would go to +0.1 percent, and June 2018′s result would be 7.5 percent higher than June 2017 — well above today’s reported 6.1 percent.

This track record of five misses in a row, all in the same direction, with three of them greater than 1 percent, hardly seems random or coincidental.

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