The so-called experts supposedly took March's worse than usual weather in many parts of the country into account when they predicted that this morning's March Construction Spending report from the Census Bureau would come in with a seasonally adjusted increase of 0.4 percent or 0.5 percent. Instead, the result was a decline 0.6 percent, "unexpectedly" sending that metric to a six-month low.
Nevertheless, the Associated Press's Martin Crutsinger, clearly having run out of substantive reasons to be optimistic, cited the weather as either a factor in March's result or its improvement as a reason why things really, really will get better later this year three different times (weather-related citations in bold):
US CONSTRUCTION SPENDING DROPS 0.6 PERCENT IN MARCH
U.S. construction fell in March as an increase in nonresidential construction was offset by declines in home building and government projects.
Construction spending dropped 0.6 percent to a seasonally adjusted $966.6 billion in March after a flat reading in February, the Commerce Department reported Friday. Construction activity has fallen or shown no gain in four of the past five months, underscoring the economic toll from a severe winter.
... Economists are forecasting a rebound in coming months as warmer weather boosts activity.
The government reported Wednesday that the overall economy, as measured by the gross domestic product, grew at a meager annual rate of 0.2 percent in the January-March quarter.
... Residential construction also slowed, growing at a modest annual rate of 1.3 percent in the first quarter, the weakest performance in a year.
Economists are looking for growth to strengthen in the April-June quarter. Warmer weather should boost multiple sectors of the economy, including construction and consumer spending.
Growth may "strengthen" in the second quarter; but it's starting from a near-zero base, so almost anything sign of a pulse would be an improvement. At least one prognosticator says that the second quarter isn't looking good at all. The GDP Now model run by the Federal Reserve Bank of Atlanta, which is one of the few outfits to predict how weak Wednesday's GDP result would be — they thought it would be 0.1 percent, while almost everyone else was at 1.0 percent or higher — was at an annualized 0.9 percent for the second quarter as of Thursday. In response to today's news, the Atlanta Fed cut its prediction to 0.8 percent.
Of course, Marty Crutsinger didn't report that.
Cross-posted at BizzyBlog.com.
