As people cheered the stronger than expected ISM manufacturing index, they seems to have missed that another important economic report was released that was much weaker than expected: namely construction spending
which fell by 2.5% in December compared to the previous month and 6.4% compared to December 2009. All categories of construction, government construction, private residential and private non-residential fell.
All in all, recent economic reports suggests that the U.S. economy continues its recovery, but at a relatively slow pace and in a very uneven way. Manufacturing seems to have a fairly strong recovery, while growth is much slower in services and with the construction sector still being in a recession.