Investors are pouring more money into new construction projects in the wake of a year-end federal bridge deal, with the latest one expected to be the biggest ever.
A wave of bond purchases by investors in the bond market has increased significantly in the past few weeks, the U.S. Treasury Department said Thursday, as bond investors prepare for a potential rebound in construction and investment in bridge and other infrastructure projects.
The latest round of bond issuance has helped the nation’s infrastructure industry grow more than the previous nine quarters, the department said.
The nation’s total infrastructure spending has more than tripled to $1.9 trillion this year from $900 billion in the first quarter of 2017, the highest pace since 2010, according to the department.
That’s due in large part to strong economic growth and a growing demand for public infrastructure, which is crucial to keep people connected and healthy, according the department, which oversees the nations infrastructure.
But the surge in bond issuance is also due to investors’ worries about the long-term outlook for infrastructure spending.
The economic downturn has led many bond investors to cut back on the number of bond offerings, particularly for infrastructure, according a report from financial research firm RBC Capital Markets.
The market is also looking to refinance some of the $1 trillion in debt held by private investors.
Still, the country’s infrastructure companies have also been able to continue their expansion and the country is still projected to have $4.4 trillion in infrastructure investment in 2020, according RBC.