23 April 2008 20:12 [Source: ICIS news]
HOUSTON (ICIS news)--A leading indicator of US construction activity fell in March to its lowest level since its 1995 inception, according to statistics released on Wednesday by the American Institute of Architects.
Construction is an important chemical end market, according to the American Chemistry Council (ACC). The industry directly purchases an average of $8 (€5) in chemistry for every $1,000 worth of output.
Indirectly, the construction market buys more than twice that amount through purchases of coatings, plastic pipe, adhesives and other products, the council said.
The institute's architecture billings index fell to 39.7 in March, down 2 points from February. The index for February fell 9 points from January.
Anything below 51 indicates a decrease in billings.
Inquiries for new projects fell to 48, another all-time low, the institute said.
“Aside from historically low project demand, all regions are showing very poor business conditions," said Kermit Baker, chief economist for the institute. "This is not likely to reverse itself anytime soon.”
The US housing market has now been in a multi-year slump, dragging down demand for paints, coatings and polyvinyl chloride (PVC).
Nonresidential construction has helped offset the downturn in US housing. However, the sector is now showing signs of slipping.By sector, the index for residential billings fell to 31.7, down from 40.8, the institute said. The index for commercial and industrial billings reached 48.3, down from 41.1.
The institutional index reached 50.8, down from 51.5. The institute's mixed sector was 40.9, down from 42.9m.Architectural billings generally lag construction spending by 9-12 months, making them a good indicator of future activity.
($1 = €0.63)For more on PVC visit ICIS chemical intelligence
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