- U.K. Construction Rebounds in October
The U.K. construction sector rebounded in October following improvement in the housebuilding sector.
Construction Purchasing Managers’ Index rose to 50.8 in October, up from 48.1 recorded in September, according to the IHS Markit report released on Thursday.
Tim Moore, the Associate Director at IHS Markit attributed the increase in activity to the housebuilding sector.
“Greater house building was the sole bright spot in an otherwise difficult month for the construction sector,” he said.
“Sustained declines in civil engineering and commercial activity meant that large areas of the building industry have become stuck in a rut.
The report showed reduced tender opportunities and fragile demand are weighing on the near-term outlook for the construction industry. Forcing construction companies to cut down on recruitment as they head into the winter with heightened concern about demand conditions.
Business confidence in the industry is at the lowest level since December 2012.
Again, despite the uncertainty surrounding the growth, the better than expected number adds to Wednesdays’ expansion in the manufacturing sector to give a clue of the UK’s economic resilience ahead of interest rate hike.
The Bank of England is expected to raise interest rates for the first time in a decade on Thursday.
“Those at the top of the supply chain are not dwelling too much on Brexit uncertainty and this PMI suggests September’s [negative] reading may have been a blip,” said Mike Chappell, global corporates managing director for construction at Lloyds Bank Commercial Banking.