Ahead Of The Bell: Construction Spending

WASHINGTON (AP) — Construction spending likely retreated in September following a housing-fueled rise in August. A slip in building activity would underscore the fragile nature of the housing recovery, which analysts hope will provide support for the overall economy in the months ahead.

Economists surveyed by Thomson Reuters expect construction spending fell 0.3 percent after rising 0.8 percent in August. The Commerce Department is scheduled to release the report at 8:30 a.m. EST Monday.

The August construction increase came after three straight months of declines. It reflected a 4.7 percent rise in private residential activity, the biggest one-month increase since November 1993.

That surge was spurred partly by builders rushing to ramp up construction to take advantage of a first-time homebuyers tax credit of up to $8,000 scheduled to expire on Nov. 30.

Senators agreed last week to extend the tax credit for potential buyers who have sales agreements signed by the end of April. Those buyers would have until the end of June to close on their new homes. The proposed extension must be approved by the Senate and the House to become law.