Thursday, July 1, 2010

Construction appears to have stabilized

Residential construction spending has firmed somewhat over the past year, lending credence to the argument that the housing market has bottomed, but it is such a tiny (2.4%) part of the economy now that what happens there is almost irrelevant to the economy's growth outlook. Nonresidential construction, somewhat surprisingly, has firmed in recent months, but I don't see a reason for this strength to continue in any meaningful fashion. The best that can be said about construction at this juncture is that it is not collapsing.

1 comment:

brodero said...

With residential investment at 355
billion and structures at 417 billion,,,basically 5% of
much more can these components hurt
nominal GDP??