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The American Institute of Architects’ (AIA) ABI Index – a leading economic indicator of non-residential construction activity 9-12 months into the future – posted a steep monthly drop of 2.6 points in May, coming in at 45.8, the lowest level since early 2010.  The index has now fallen some 5.3 points since the recent peak in February, as business confidence continues to deteriorate amid the ongoing Euro-zone debt crisis and the economic slowdown in China.

The new project inquiry index fell only nominally from 54.4 to 54.0 – the lowest level in a year – and while a reading above 50 indicates growth, we maintain our cautious approach in assessing the inquiry index, as the AIA does not adjust for multiple bids.

The overall report was dismal, with all eight sub-indices declining from April, and only one coming in above 50.

Our full report is available to subscribers and provides further thoughts on the May ABI Index as well as the impact on steel equities.

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