The Dodge Momentum Index fell 2.6 percent in February compared to the previous month, according to McGraw Hill Construction, a division of McGraw Hill Financial. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year.
February’s decline brought the Momentum Index to 116.5 (2000=100), down from January’s revised119.7 but still nearly 20 percent above the year-earlier (February 2012) reading of 97.4, according to McGraw Hill. The construction group predicts that the latest month’s retreat is expected to be a brief pause in a broader upward trend.
The February Momentum Index saw contraction in both its main components. New plans for commercial buildings, usually the more cyclically sensitive sector, dropped 1.7 percent while institutional building fell back by 3.7 percent. On the commercial side, declines were reported across all of the major building types.
The institutional component, meanwhile, was weighed down by a large downturn in education building plans, according to the report. The education decline, however, was partially offset by an increase for new healthcare projects, according to the report.