U.S. construction spending fell for a fifth consecutive month in February, but the results were better than expected and suggested that the sector's long contraction may be nearing an end. The Commerce Department reported Wednesday that construction spending fell 0.9 percent in February, less than the 1.5 percent decline expected by economists. Total construction spending has been falling since October and is at the slowest pace in almost five years at an annual rate of $967.5 billion. A 4.3 percent drop in housing construction—pushing it to the lowest level in 11 years—dragged down February's overall construction data. Homebuilders have sharply reduced activity and face an oversupply of unsold homes as record mortgage foreclosures put more properties on the market. Non-residential construction spending rose 0.3 percent in February, a slight rebound following a 4.3 percent plunge in January that had been the biggest monthly decline in 15 years. With the financial sector in its worst crisis in seven decades, banks have tightened lending standards, making it more difficult to obtain financing for commercial projects. Government construction spending rose 0.8 percent in February following two months of declines. Both federal construction building and state and local building projects increased 0.8 percent.
