U.S. construction spending dropped further in June amid a sharp decline in outlays on single-family housing projects because of higher mortgage rates and rising inventory. The Commerce Department's Census Bureau said on Friday that construction spending fell 0.4% after a revised 0.4% decrease in May. Economists polled by Reuters had forecast construction spending unchanged after a previously reported 0.3% drop in May. Spending fell 2.9% on a year-over-year basis in June. Spending on private construction projects slipped 0.5%. Investment in residential construction decreased 0.7%, with outlays on new single-family housing projects plunging 1.8%.