2024-04-24 10:55:00 ET
Summary
- After weathering the 2023 banking stresses and ongoing high interest rate environment, 2024 and beyond is likely to be more challenging.
- Financing conditions remain restrictive, and political uncertainty is on the rise with US and Mexican Presidential elections.
- High government deficits further limit the scope for support for the sector.
By James Knightley & Coco Zhang
Construction outperformed expectations in 2023
Given the backdrop of high interest rates, tight credit availability and worries about a potential financing crunch in the wake of US banking failures in March of last year, the North American construction sector performed well in 2023. Mexico was top, experiencing rapid growth, led by accelerated public infrastructure spending ahead of this year's Presidential election. In the US, a lack of existing homes for sale meant demand for new homes remained resilient despite high mortgage rates. At the same time, government support to incentivise the reshoring of manufacturing activity has seen construction activity in the non-residential sector perform even more strongly than for home building....
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For further details see:
North America Construction Outlook: Politics And Policy Rates Test The Sector's Resilience