The Dodge Momentum Index dropped 2.6 percent in September to 159.5 (the year 2000=100) from the revised August reading of 163.7. 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.

Both components of the momentum index were lower in September: The commercial component fell 4.3 percent, while the institutional component lost 0.1 percent. The momentum index has now fallen for two consecutive months; however, due to a very strong reading in July it increased 0.8 percent from the second quarter to the third quarter.

The momentum index may seem to have lost some impetus, but this can be attributed to outsized gains in the late spring and summer. In fact, the momentum index is now returning to a more sustainable level of activity given the overall age of the current construction cycle.